August 16, 2023 (NO COMMENTS)

Expansion of trading risk charges to banks above $100bn in assets would also affect firms with minimal trading activity

At least nine US lenders – among them American Express, First Citizens Bank and M&T Bank – may have to start capitalising trading exposures under a proposed rule change from the Federal Reserve, Risk Quantum analysis has found. Under the current framework, adopted in 1996, banks are required to model and capitalise market risk only if their trading assets and liabilities sit above certain thresholds. The Fed’s proposal, released on July 27 as part of its Basel III endgame package of regulations