

FRTB comes too late for Covid crisis
Expected shortfall would stop Basel 2.5 duplicate capital charges, but backtesting still a problem
In a parallel world, regulators had already introduced their much-trumpeted overhaul of market risk rules, the Fundamental Review of the Trading Book, at the start of 2019. The old, stop-gap method for calculating market risk-weighted assets was discarded. And not a moment too soon. Amid the chaos of the coronavirus pandemic, bankers could at least take comfort that they were no longer subject to Basel 2.5 with its flawed and procyclical methodology.
Or not. In reality, years of regulatory
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