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> simply means that the risk has been well disguised (e.g. is off balance sheet / using creative accounting) Basel2 creates end-to-end transparency[1]. It is s
by nikatwork 13y ago
> simply means that the risk has been well disguised (e.g. is off balance sheet / using creative accounting)
Basel2 creates end-to-end transparency[1]. It is specifically designed to prevent hiding risks.
[1] http://www.investopedia.com/articles/07/basel2.asp http://www.investopedia.com/articles/07/basel2.asp
- zzleeper 13y agoNot really, it has tons of flaws, some of which they are now trying to fix with Basel 3: http://en.wikipedia.org/wiki/Basel_III http://en.wikipedia.org/wiki/Basel_III
- nikatwork 13y agoBasel2 is not perfect, but it's one million times better that what many banks were using previously (nothing). I work with banks so I've seen it firsthand. TFA was talking about how successful such systems have been in Sweden and Oz; let's hope Basel3 is even better.
- crdoconnor 13y agoBanks can use their own risk models to set minimum capital levels: http://www.ft.com/cms/s/0/0e8404a2-e54e-11dc-9334-0000779fd2ac.html http://www.ft.com/cms/s/0/0e8404a2-e54e-11dc-9334-0000779fd2... Dial down the hubris please.
- nikatwork 13y agoApologies, that was aggressive. I've edited for tone.
- wisty 13y agoI thought Basel II was depreciated after a spot of instability in 2007. After that, they started moving to Basel III.