IBFed responds to Basel consultative document on G-SIBs -26/08/11

26 Aug 2011

IBFed has responded to the Basel Committee’s Consultative Document "Global systemically important banks: Assessment methodology and the additional loss absorbency requirement".
While supporting the objective of the paper and the need to reduce the probability and the impact of any failure of G-SIBs, we expressed concern about the imposition of a surcharge, at least not at such high levels. And we pointed out the importance of understanding both the effect and interplay of new requirements and their potential to affect the pace of financial recovery and future economic growth, in advance of adding an additional requirement. We also underlined that it is essential to re-assess the proposed framework for the G-SIB assessment methodology and the additional loss absorbency requirements at a later point in time.The IBFed letter is available here.