Written question asked by Lord Myners (Labour), in the House of Lords. It was answered by Lord Sassoon (Conservative) on Friday, 9 July 2010.

Banking

Question: To ask Her Majesty’s Government what assessment they have made of the risk to financial stability of the Basel Committee on Banking Supervision relaxing proposed capital requirements to support derivatives dealing by major investment banks and to defer introducing other requirements for banks to set aside more capital against derivatives.

Answer: The UK fully supports the work of the Basel Committee on Banking Supervision to strengthen the market risk framework, and to require banks to hold significantly more capital against their trading book activities, including derivative dealing by major investment banks. As a result of these revisions, the Basel Committee has estimated that market risk capital requirements will increase by three to four times for large internationally active banks. The Basel Committee has agreed a co-ordinated start date of no later than 31 December 2011.

Secondary information

Type: Written question
Reference: 690; 720 c79WA
Session: 2010-12
Subjects: Banks Finance International cooperation Standards Stocks and shares Basel Committee on Banking Supervision
Link: View this Written question on www.publications.parliament.uk