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U.S. Banking Regulators Propose Markedly Higher Credit Risk Weights for Securitization
Reprinted from: SSRN |Cadwalader partner Christopher Horn authored an article, “U.S. Banking Regulators Propose Markedly Higher Credit Risk Weights for Securitization,” published in the Risk Management & Analysis in Financial Institutions eJournal.
In the article, Chris and co-author W. Scott Frame (Bank Policy Institute) discuss U.S. federal banking regulators 2023 proposal to amend capital requirements to implement the revised international standards set by the Basel Committee on Banking Supervision. The article summarizes the current approach to risk-weighting securitization exposures, outlines the proposed changes and illustrates their implications, and discusses how the proposal diverges with Basel 3 Endgame standards implemented in Europe.
