The Basle Committee on Banking Supervision has amended the Basle Capital Accord, reducing the risk weight for claims on, and claims guaranteed by, certain securities firms from 100 percent to 20 percent. The Basle Accord is an international agreement setting minimum capital requirements for banks.
In general, the amendment will provide a reduced capital charge for claims on or guaranteed by broker-dealers registered with the Securities and Exchange Commission and their direct subsidiaries that meet the supervision and capital requirements.
Securities firms must be incorporated in OECD countries and subject to supervisory and regulatory arrangements comparable to those applied under the Basle Accord to qualify for the preferential risk weight.
The Federal Deposit Insurance Corporation plans to work with the other federal banking agencies to incorporate the revision into its risk-based capital rules for state non-member banks.
The Basle Committee announcement may be accessed on the Bank for International Settlements Web site at http://www.bis.org. Copies may also be obtained by contacting the FDIC's Public Information Center at 800-276-6003 or (703) 562-2200.
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Congress created the Federal Deposit Insurance Corporation in 1933 to
restore public confidence in the nation's banking system. The FDIC
insures deposits at the nation's 11,027 banks and savings associations
and it promotes the safety and soundness of these institutions by
identifying, monitoring and addressing risks to which they are
FDIC press releases and other information are available on the Internet via the World Wide Web at www.fdic.gov, and may be obtained through the FDIC's Public Information Center, 801 17th Street, N.W., Room 100, Washington, D.C. 20434 (800-276-6003 or (703) 562-2200).