Bank Capital and Loan Loss Reserves Under Basel II: Implications for Emerging Countries
The authors propose an integrated approach to minimum bank capital, and loan loss reserves regulation. They break new ground in two main areas. First, the authors provide an explicit measurement of the credit loss distribution for a sample of emerg...
| Main Authors: | , , |
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, D.C.
2013
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2004/10/5304264/bank-capital-loan-loss-reserves-under-basel-ii-implications-emerging-countries http://hdl.handle.net/10986/14221 |
| Summary: | The authors propose an integrated
approach to minimum bank capital, and loan loss reserves
regulation. They break new ground in two main areas. First,
the authors provide an explicit measurement of the credit
loss distribution for a sample of emerging countries,
providing a benchmark for discussing the appropriate
calibration of new regulatory capital, and loan loss
provision requirements for non-G10 countries. Second, on
normative grounds, they propose a simplified version of the
"internal rating based" (IRB) approach as a
transition tool that, while retaining a risk-based
definition of solvency ratios, implies reduced supervisory
monitoring costs, and could therefore be of interest to
emerging countries, where supervisory resources are
particularly scarce. |
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