Regulatory Alerts2012-06-03
Basel Committee on Banking Supervision Consultative Document Entitled Fundamental Review of the Trading Book
The Saudi Arabian Monetary Agency issued a directive requiring all banks to evaluate the Basel Committee on Banking Supervision’s consultative document, which proposes fundamental revisions to trading book capital requirements. The updated framework strengthens market risk standards by redefining book boundaries, implementing stressed calibration, transitioning from value-at-risk to expected shortfall, and incorporating market illiquidity risk. Banks must distribute the proposal to relevant managers, submit comments by 11 August 2012, and finalize internal responses by 15 August 2012 to comply with the regulator’s submission timeline.
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