Tuesday, October 14, 2008

The European Union way …

When it comes to capital requirements, you can do it the easy way … or there is the EU way, using Directive 2006/49/EC (Annex VII) - click the pic to enlarge:

"The competent authorities may allow institutions in general or on an individual basis to use a system for calculating the capital requirement for the general risk on traded debt instruments which reflects duration, instead of the system set out in points 17 to 25, provided that the institution does so on a consistent basis."

Easy when you know how!