Beyond the pail

Australia’s regulator has hinted that it may work outside of the Basel Accord to set its own risk weightings for residential mortgages if adjustments aren’t made, writes Nick Sawyer.

The Australian Prudential Regulation Authority (APRA), Australia’s regulator, has not been shy in sharing its views on the new Basel capital Accord. Since its official submission to the Basel Committee on Bank Supervision at the end of the first consultative period last June, it has pointed to the risk weighting for residential mortgages in the Accord’s standardised approach as dangerously out of kilter with conditions in the Australian market. And as the Accord reaches the closing stages

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