CRD IV: Difference between revisions
From ACT Wiki
Jump to navigationJump to search
imported>Doug Williamson (Add reference to update proposals to CRD V.) |
imported>Doug Williamson (Remove surplus link.) |
||
| Line 36: | Line 36: | ||
* [[Capital]] | * [[Capital]] | ||
* [[Capital adequacy]] | * [[Capital adequacy]] | ||
* [[Capital Requirements Directive]] | * [[Capital Requirements Directive]] | ||
* [[Capital Requirements Regulation]] | * [[Capital Requirements Regulation]] | ||
Revision as of 20:42, 29 January 2022
Bank supervision - EU.
CRD IV is the EU Capital Requirements Directive (CRD), 2013/36/EU, implementing Basel III in the European Union (EU).
It comprises prudential rules for financial institutions covering:
- Requirements on quality and quantity of capital;
- Rules for counterparty risk;
- A base for liquidity and leverage requirements; and
- Macroprudential standards.
The related rules and supervisory statements to implement CRD IV in the UK are set out in the Prudential Regulatory Authority (PRA)'s Policy Statement PS7/13.
The PRA's statement refers to the CRD and the related Capital Requirements Regulation (575/2013) as jointly comprising 'CRD IV'.
Loans raw material cost rises
- "Under CRD IV, the amount of capital that banks must hold against credit risk is now 2-2.5 x higher than it was pre-crisis.
- Given this increase in the raw material cost of manufacturing loans, lending has naturally become a more expensive process."
- The Treasurer magazine, April 2017, p24 - Nick Burge, MD, head of strategic liquidity at Lloyds Bank.
Proposals to update Capital Requirements Directive (CRD), to replace CRD IV, are referred to as CRD V.
