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Reg rageJanuary 4 2016

Uncertainty surrounds operational risk shake-up

The Basel Committee wants to remove internal models from the calculation of banks’ operational risk capital, but needs to find a suitable replacement.
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What’s happening?

Stefan Ingves, the Swedish central bank governor and chairman of the Basel Committee on Banking Supervision (BCBS), confirmed long-standing speculation in November 2015 that the BCBS will soon propose removing the advanced measurement approach (AMA) to calculating operational risk capital. This would mean that all banks will calculate how much capital to hold against operational risks using a new standardised approach that the BCBS is currently drafting.

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