EBA yesterday published a Discussion Paper (DP) on the exclusion of unrealized gains from regulatory capital. As an advice to the European Commission it basically supports the current European system of prudential filters – that is, only the unrealized gains part (banks will have to include unrealized losses into capital). EBA’s departure from Basel III… Read More EBA leans against Basel III in excluding unrealized gains from Regulatory Capital
A large document for sure, and relevant, as accounting is the prime source of capital values. Shaun Drummon of AFR notices the Board’s stance on AOCI: “One of the most controversial has been the liberal use of other comprehensive income (OCI), otherwise known as the reserve, in revisions to accounting rules to park movements in… Read More IASB’s stance on AOCI Discussion Paper on the new Conceptual Framework
It features on the EBA home page, but obscured by the the words “Single Rulebook Q&A”, it is a neat tool nevertheless. Click here for access.
An interesting aside of the US Basel III adoption is the relief of the inclusion of Accumulated Other Comprehensive Income (AOCI). Its inclusion in Common Equity Tier 1 regulatory capital (CET1) is only mandatory under the final rules for banks subject to the advanced approach, which is applicable to banks with total assets of $250… Read More Basel III, US, and AOCI