European Commission changes tune on proposed FRTB multiplier
Banks fear departure from original diversification factor undermines case for permanent relief
The European Commission has changed its reasoning for a planned temporary multiplier designed to soften upcoming market risk capital rules.
Banks fear the move may make it less likely for the relief to be adopted permanently, which is their preferred outcome.
The EC’s new justification for the multiplier is to avoid placing European banks at a competitive disadvantage to peers in other jurisdictions.
“I am puzzled by this last-minute change in the rationale,” says a regulatory expert at a European
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