Article
Basel's Gone Cold on Cocos, But Is This a Blessing in Disguise for Banks?
Banking Report (BNA)
(2011)
Abstract
The last few months have seen a dramatic fall in the value of bank stocks both in Europe and the U.S., bringing
back unpleasant memories of the depths of the financial crisis in 2008. Concerns about the sovereign debt crisis
in Europe, continuing litigation relating to the American subprime mortgage crisis, and the generally poor state
of the world economy have increasingly put banks under pressure. However, some commentators have pointed
out the “silver lining” in all of this: the big American and European banks are better capitalized than they were
during the financial crisis, and therefore are better able to absorb these shocks and less likely to fail. 1 Part of
the reason that banks have increased their capital cushions is in anticipation of the new regulatory capital
requirements that are being phased in by the Basel Committee on Banking Supervision (the “BCBS”) as part of
Basel III.
Keywords
- financial crisis,
- American subprime mortgage crisis,
- Basel Committee on Banking Supervision,
- BCBS
Disciplines
Publication Date
September 27, 2011
Citation Information
Hilary J Allen. "Basel's Gone Cold on Cocos, But Is This a Blessing in Disguise for Banks?" Banking Report (BNA) Vol. 97 Iss. 11 (2011) Available at: http://works.bepress.com/hilary-allen/97/