Basel 2.5 prompts flurry of asset sales and risk transfer deals

The profits of imbalance

auction

Europe's banks had little reason to celebrate the striking of midnight on December 31 – the new year means they are now subject to new trading book capital rules, known as Basel 2.5, which will see a big leap in the risk-weighted asset (RWA) numbers for securitisation, structured credit and correlation books in particular. It comes at the worst possible time – just two months after the European Banking Authority announced the continent’s banks would be expected to achieve a 9% Tier I capital-to

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