Basel Seeks Stiffer Capital Rules For Asset-Backed Securities

Law360, New York (December 18, 2012, 2:19 PM EST) -- The Basel Committee on Banking Supervision on Tuesday said it aims to push banks to hold back more capital to cover potential risks posed by asset-backed securities in their portfolios, saying that banks and national regulators rely too heavily on mechanical tests when determining the amount of capital to hold.

The committee, made up of a panel of international banking regulators, said that it wanted input from market participants on its proposals for making asset-backed securities — which many observers say contributed to the collapse of...
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