
Japanese banks eye phased CVA introduction
Working group reports “growing need” for valuation adjustment but cherry-picking fears persist

A Japanese industry group believes there is a “growing need” to introduce credit valuation adjustment (CVA) into the fair values of local banks’ derivatives portfolios, but says the accounting measure, which would generate losses in earnings, should be phased in across different portfolios over time – a practice some accountants disagree with.
The Japanese Bankers Association (JBA) formed a working group in February to discuss the implementation of CVA into accounting for the first time, based
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