Banks rocked by U-turn on FRTB equity risk weights

Risk managers warn of higher capital charge after Basel reverts to original 2016 treatment

A surprise decision by global rulemakers to abandon plans to lower standardised risk-weights for equity trading has been met with dismay from bankers, who fear stiff capital charges under the latest version of the market risk regime.

The Basel Committee on Banking Supervision had previously proposed changes to its Fundamental Review of the Trading Book in a bid to soften the capital impact of the new rules. But the final text released on January 14 reversed those changes – a move that one