Comments on: Basel Committee’s New Proposals http://www.irisheconomy.ie/index.php/2009/12/20/basel-committees-new-proposals/ Wed, 23 May 2012 06:49:51 +0000 http://wordpress.org/?v=2.6.3 By: Pat Donnelly http://www.irisheconomy.ie/index.php/2009/12/20/basel-committees-new-proposals/#comment-29266 Pat Donnelly Wed, 23 Dec 2009 04:11:27 +0000 http://www.irisheconomy.ie/?p=5052#comment-29266 http://www.nakedcapitalism.com/2009/12/basel-iii-%e2%80%93-the-ok-the-unfinished-and-the-ugly.html Another view, that of an insider. http://www.nakedcapitalism.com/2009/12/basel-iii-%e2%80%93-the-ok-the-unfinished-and-the-ugly.html

Another view, that of an insider.

]]> By: karl deeter http://www.irisheconomy.ie/index.php/2009/12/20/basel-committees-new-proposals/#comment-29018 karl deeter Mon, 21 Dec 2009 18:17:45 +0000 http://www.irisheconomy.ie/?p=5052#comment-29018 interestingly it sounds like they've solved everything, oddly there is no mention of the result of the conversation on counter-cyclical capital reserves because it was a stand off between supervisors and central bankers. All of the models tend to break when you have extremes of stress so the prevention needs to be done on the way up, any progress is progress but without some form of limiting acceleration on capital requirements when balance sheets grow rapidly misses the point to a degree (imho). interestingly it sounds like they’ve solved everything, oddly there is no mention of the result of the conversation on counter-cyclical capital reserves because it was a stand off between supervisors and central bankers. All of the models tend to break when you have extremes of stress so the prevention needs to be done on the way up, any progress is progress but without some form of limiting acceleration on capital requirements when balance sheets grow rapidly misses the point to a degree (imho).

]]> By: Pat Donnelly http://www.irisheconomy.ie/index.php/2009/12/20/basel-committees-new-proposals/#comment-28962 Pat Donnelly Mon, 21 Dec 2009 11:18:13 +0000 http://www.irisheconomy.ie/?p=5052#comment-28962 We will eventually end up with one, good bank, if we want it. But only after we have poured a mighty amount of what borrowing capital we have left down the bad bank drain! This is a disaster! We will eventually end up with one, good bank, if we want it. But only after we have poured a mighty amount of what borrowing capital we have left down the bad bank drain!

This is a disaster!

]]> By: yoganmahew http://www.irisheconomy.ie/index.php/2009/12/20/basel-committees-new-proposals/#comment-28933 yoganmahew Mon, 21 Dec 2009 10:14:56 +0000 http://www.irisheconomy.ie/?p=5052#comment-28933 Jon Ihle has a piece about this in the Tribune http://www.tribune.ie/business/news/article/2009/dec/20/boi-and-aib-face-pressure-to-find-51bn-in-capital/ First guess is 5.1 bn in capital required just because of the deferred tax loss, pension short-fall, buttons and washers requirements... Note, this will be in addition to NAMA-based recapitalisation and, I believe, still only keeps the banks at 4% tier 1 core equity (or 'money' as the rest of us might call it). The new standard for leverage (i.e. money) seems to be set at about 12-1 (8%) so there's a fair amount of deleveraging required, it seems. There's lots of other interesting stuff in Basel III, if it gets implemented. Particularly relating to derivatives... Jon Ihle has a piece about this in the Tribune
http://www.tribune.ie/business/news/article/2009/dec/20/boi-and-aib-face-pressure-to-find-51bn-in-capital/

First guess is 5.1 bn in capital required just because of the deferred tax loss, pension short-fall, buttons and washers requirements…

Note, this will be in addition to NAMA-based recapitalisation and, I believe, still only keeps the banks at 4% tier 1 core equity (or ‘money’ as the rest of us might call it). The new standard for leverage (i.e. money) seems to be set at about 12-1 (8%) so there’s a fair amount of deleveraging required, it seems.

There’s lots of other interesting stuff in Basel III, if it gets implemented. Particularly relating to derivatives…

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