Arthur Bautzer

By US proposals would significantly reduce banks' capital costs from using their own models to calculate trading risks compared with previous plans, according to an industry study seen by Risk.net. Amendments made by regulators to the rules could avert a large-scale abandonment of market risk models witnessed in the rest of the world. "We see a lot of positive changes, and as a result we expect to see

US capital proposals would entail a whopping 96% rise in derivatives counterparty risk charges. But while this potential doubling has struck fear into some in the industry, others believe it’s no big deal. Sources argue banks could slash the capital hit by tweaking hedges to align with the new regulatory view of exposures. There are calls, however, for greater alignment than is perhaps currently envisaged. “It’s possible to reasonably align the capital relief with hedging the market risk,” says

By US capital proposals would entail a whopping 96% rise in derivatives counterparty risk charges. But while this potential doubling has struck fear into some in the industry, others believe it's no big deal. Sources argue banks could slash the capital hit by tweaking hedges to align with the new regulatory view of exposures. There are calls, however, for greater alignment than is perhaps currently