EBA publishes results of the Basel III monitoring exercise as of end 2012

Just a quicky – from EBA: it publishes today its fourth report of the Basel III monitoring exercise on the European banking system. Click here for the full report. “The exercise monitors the impact of the implementation of the Basel III requirements in the EU, based on the assumption of a full implementation of the… Read More EBA publishes results of the Basel III monitoring exercise as of end 2012

Are deductions from bank capital always deductions?

This week Bloomberg’s Charles Penty and Angeline Benoit reported on Banco de España’s efforts to apply a waiver for capital deductions originating from Deferred Tax assets. Now, discussions on deductions from regulatory capital are often passionate – they consume lots of resources. This post argues that elaborate and detailed discussions on capital deductions are probably… Read More Are deductions from bank capital always deductions?

Update on Deutsche

Shortly after my posting, Deutsche announced it would not call its perpetual bond, reports Reuters. One rationale for not calling could be that the bond would still be useful as bailinable debt. An interesting trade-off has been made in favor of keeping old-style instruments over new, Bazel III-compliant, instruments. One could argue that a choice… Read More Update on Deutsche

Deutsche’s phase-out of old-style capital securities and the meaning of perpetual debt

On July 17, I posted on this blog about the difficulties that EU banks face when replacing pre-crises capital securities with Basel III compliant securities. Today the WSJ illustrates these difficulties for Deutsche Bank. This bank struggles with capital securities that were issued before the financial crisis made us painfully aware of their abysmal prudential… Read More Deutsche’s phase-out of old-style capital securities and the meaning of perpetual debt

Jay! EBA publishes first final draft technical standards on own funds.

The EBA published the first final draft technical standards on own funds. Its actually a bundle that complements CRR IV, the new European regulation on capital. Haven’t had the time to digest fthe final versions, but there are four pieces, according to the EBA website: The RTS on own funds part I specify elements of… Read More Jay! EBA publishes first final draft technical standards on own funds.

Europe’s painful phase-out of old-style capital instruments

Matthew Attwood in Financial News reports on the difficulties that European banks face when replacing pre-crises capital instruments by Basel III compliant instruments. This was a small disaster waiting to happen, as Bazel III rules made it clear, pretty much from the outset, that it wanted to see the back of “old-style” instruments sooner rather than… Read More Europe’s painful phase-out of old-style capital instruments