Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Wednesday, July 17, 2024 | Back issues
Courthouse News Service Courthouse News Service

Bank Risk

WASHINGTON (CN) - Federal financial regulators have agreed on a framework for establishing how much capital large banks must set aside to guard against risk. New regulations are based on the Basel II Capital Accord, which attempts to create an international standard for calculating risk so nations' financial structures do not crumble.

In the United States, as of April 1, those banks with consolidated assets of at least $250 billion or consolidated on-balance-sheet foreign exposures of $10 billion or more must use the Internal Ratings Based approach for credit risk and the Advanced Measurement Approach for operational risk. These approaches establish capital requirements and risk management expectations aligned much more closely to the actual risks assumed by the banks than the previous approaches did. Other U.S. banks may choose to "opt-in" to the requirements by becoming qualified. The new regulations also provide for enhanced standards for review of capital adequacy and for public disclosures.Click herefor details and other new regulations.

Categories / Uncategorized

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.