Banks in India face CVA fees double European levels

The RBI's use of a conservative standard CVA approach is overly prudent, say dealers

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Banks in India face credit valuation charges that are more than double the amount of the standard approach used in European regulation; a level that dealers say is excessively prudent and acts as a barrier to effective risk management by corporates.

Although India is not due to bring in the full raft of Basel III legislation until 2018, banks have been forced to hold capital against CVA charges since the beginning of 2014, applied on a standardised approach developed by the Reserve Bank of India

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