But banks in Australia and Singapore still face a number of obstacles, particularly in terms of data collection. For instance, Australian banks lack data that covers periods of economic instability because, in recent years, their losses have been low and “unrepresentative of losses expected over a full economic cycle”, the report says.
Elsewhere, Asian banks are also making steady progress towards Basel implementation, although the issue of data collection is a challenge in all territories. Standard and Poor’s found that Hong Kong and Japan are making reasonable headway, while other nations are looking at slower implementation programmes.
“Good progress appears to be occurring in some other markets, including Hong Kong and Japan, while other countries, including Korea, China, Thailand and Malaysia, are opting for a more gradual and phased implementation of Basel II,” says Tsang.