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You may not be familiar with regulatory environments.

The whole point of an internal process is that otherwise the bank will need a higher regulatory capital to cover credit risk (in particular counterparty risk) for the same portfolio.

Making it public would not change that. And that is a significant benefit. For some reason I don't manage to dig up the figures right now, but I remember that under Basel 2 and 3 it was a drop of about 40% of the credit risk capital.

Anyway I wouldn't terribly mind if risk evaluation was no longer an internal process but a public service for which the banks/insurances would be charged.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Tue Mar 5th, 2013 at 03:01:07 AM EST
[ Parent ]
Perhaps the regulatory environment is healthier in Europe than in the USA, with health being considered from a public interest point of view? Here one can have all the regulations one wants so long as one does not expect them to be seriously enforced.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Mar 5th, 2013 at 11:33:14 AM EST
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