Bridging the gap to internal models
Since the implementation of Basel 2, banks have been able to either use a regulatory
As part of the final Basel 4 standards, the Basel Committee on Banking Supervision (BCBS)
The revised CR-SA largely follows the proposals set out in the BCBS's December 2015 consultation paper, therefore the changes are not as severe as banks once feared. However, under the revised CR-SA the recalibration of risk weights in most asset classes will have a direct impact on capital requirements. In this article, we discuss the potential impacts that this could have on banks' capital requirements and business models as they implement the new standard.
A companion paper in this series covers the changes to the CR-IRB.
This article is part of our Basel 4: The way ahead series discussing the Basel 4 standards. To assess the full impact of these final rules, we are leveraging the insights of our global network to publish a series of articles that focus on specific areas affected by the standards. Find the latest articles online here.