Reuters: Basel Committee okays use of external credit ratings for banks

LONDON, Oct 10 (Reuters) – Global banking regulators have decided to allow lenders to keep using credit rating agencies to help them determine how much capital they need to hold to cover the risks of borrowers getting into trouble, a top central banker said on Friday.

Stefan Ingves, head of the Swedish central bank and chairman of the Basel Committee on Banking Supervision, said few banks were happy with proposals made in March to revise a ‘standardised’ approach for calculating credit risk. This refers to actual losses or fall in credit quality of the individuals, companies and other banks a lender deals with.

Revised proposals would be published by the end of the year, Ingves said.

The full article is available here.

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