Banks should give more info on RWAs and models, says FSB

Torchlight

The use of internal models to calculate bank capital is making it difficult for investors to compare institutions, according to a Financial Stability Board (FSB) report published yesterday. The report recommends a number of new disclosures relating to modelling choices and the risk-weighted asset (RWA) numbers on which bank capital is based.

Currently, banks with regulatory approval to use internal models are allowed a lot of latitude on how those models are built. When modelling market risk

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