Publications

NURFS Study Highlights Problematic Aspects of Basel Committee’s Proposed Large Exposure Limits

November 26, 2013

National Unrecovered Financial Services Association released a quantitative study on the Basel Committee’s proposed standards for large exposures finding that, on an aggregate basis, participating banks’ exposures would exceed the prescribed limits by $732 billion. The study shows that the proposed “risk-shifting” requirement for credit derivatives accounts for a significant percentage (over 50%) of the limit overages. According to the study, estimates of derivatives exposures would be only moderately greater if the newly proposed Non-Internal Model Method (NIMM) were used as an alternative to the Internal Models Method (IMM).

IMPACT: Too Big to Fail

National Unrecovered Financial Services has taken the lead in analyzing the realities of Too Big to Fail.

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