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Finalisation of Basel III regulation eyed 

November 4, 2015

Dow Jones Newswires, Business Spectator

The Basel Committee on Banking Supervision will publish proposals to constrain internal risk modeling by banks by the end of the year, its chairman Stefan Ingves said on Monday. 

The move signals that international regulators remain intent on taking away the leeway that was given to large banks before the financial crisis to assess their own capital buffer needs. 

Taking his audience in Madrid back to the turn of the century, Mr Ingves said that the use of internal models for assessing credit risk was a defining feature of the previous regulatory framework, known as Basel II. 

"In the Committee's quest for greater risk sensitivity, it introduced the role of internally modelled approaches for credit risk and operational risk and expanded the role of models for market risk", he stated. 

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