Capital Requirements Directive
The Capital Requirements Directive (CRD) for the financial services industry will introduce a supervisory framework in the EU which reflects the Basel II rules on capital measurement and capital standards.
Member States have to transpose, and firms of the financial service industry have to apply, the CRD from January 1, 2007. Institutions can choose between the current basic indicator approach, that increases the minimum capital requirement in Basel I approach from 8% to 15% and the standardized approach that evaluates the business lines as a medium sophistication approaches of the new framework. The most sophisticated approaches, Advanced IRB approach and AMA or advanced measurement approach for operational risk will be available on the beginning of 2008. From this date, all EU firms will apply "Basel II".
Read more about Capital Requirements Directive: Assesment and Criticism
Famous quotes containing the word capital:
“The basis of world peace is the teaching which runs through almost all the great religions of the world. “Love thy neighbor as thyself.” Christ, some of the other great Jewish teachers, Buddha, all preached it. Their followers forgot it. What is the trouble between capital and labor, what is the trouble in many of our communities, but rather a universal forgetting that this teaching is one of our first obligations.”
—Eleanor Roosevelt (1884–1962)