Big banks could face tougher rules on publishing trading risk

 
Tim Wallace
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THE WORLD’S biggest banks may be forced to publish the risks they are taking in their trading books on both easy and tough measures, global regulators said yesterday.

The Basel Committee on Banking Supervisions’ aim is to allow investors and the authorities to get a better look at the quality of the lenders.

However, the largest lenders are likely to push back against the consultation, arguing the advanced models they use better reflect the specialities of their business.

Currently they report risks using the advanced models, not than the tougher, one-size-fits-all standard model used by smaller banks.

“We suspect regulators, and perhaps more importantly the wider market, will increasingly be challenging banks strongly where the model shows a much lower risk figure than the standardised approach,” said PwC’s Patrick Fell.

“Some banks may have a hard time in the public arena.”