Basel II: The road ahead
| Pages | 297-302 |
| Date | 01 December 2003 |
| DOI | https://doi.org/10.1108/13581980310810570 |
| Published date | 01 December 2003 |
| Author | Jaime Caruana |
| Subject Matter | Accounting & finance |
Comment
Basel II: The road ahead
Jaime Caruana
Jaime Caruana is the Governor of the
Banco de Espan
˜a. He was appointed to
the post in 2000, becoming a member of
the Governing Council of the European
Central Bank in the same year. He
became Chairman of the Basel Committee
in 2003. He is the author of several publi-
cations and articles on various aspects of
the Spanish financial system, the financing
of public administrations and the manage-
ment of public debt.
ABSTRACT
KEYWORDS: bank supervision, Bank for
International Settlements, Basel II, capital
adequacy
The following extract is taken from a speech by
Jaime Caruana, Governor of the Bank of
Spain, as Chairman of the Basel Committee on
Banking Supervision, given to the Institute of
International Finance in Dubai on 21st Sep-
tember, 2003.
PROPOSALS FOR A NEW CAPITAL
ACCORD
The comment period for the third consul-
tative paper (CP3) [on proposals for a new
Capital Accord] closed at the end of July.
If you have seen the ‘comments on CP3’
page of the Bank for International Settle-
ments’ (BIS) website, you will not be sur-
prised to hear that we have received over
200 responses. I must admit that this is
more than we had expected, even if it is
below the 250 responses we received on
the second consultative document two
years ago. Obviously, not all of the com-
ments are mutually compatible, nor would
it be feasible to incorporate them all. How-
ever, there are some substantive issues
which have been raised, and I will mention
some of these briefly shortly. But just let
me say first that the Committee is taking
the comments very seriously and working
extremely hard to resolve the issues that
have been raised. What is most important
to the Committee is the quality and consis-
tency of the New Accord, and we are clear
that this cannot be unnecessarily con-
strained by deadlines and timetables.
Michelangelo once said that, having seen
an angel in a block of marble, he carved
until he set it free. From most of the letters
of comment received by the Committee
this summer, it seems that the industry sees
an angel in the proposals and wants to
carve away at the text until it has been set
free. Indeed, even among the most critical
of respondents we had support for the
Committee’s three pillars and its intent to
align capital more closely to risk; to intro-
duce greater consistency in the supervisory
review of capital adequacy; and to promote
effective market discipline by enhancing
transparency. It was, moreover, satisfying
for us that most commentators acknowl-
edged substantial improvements in the pro-
posals since the release of the second
consultative paper in early 2001.
Respondents have raised a large number
of issues for consideration, including sev-
Page 297
Journal of Financial Regulation and Compliance Volume 11 Number 4
Journal of Financial Regulation
and Compliance, Vol. 11, No. 4,
2003, pp. 297–302
Henry Stewart Publications,
1358–1988
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