New CRD IV draft exempts sovereign trades from CVA capital charge

A lifebuoy

Banks will not be hit with a capital charge for credit value adjustment (CVA) on trades conducted with European debt management offices and central banks under proposed amendments to European bank capital rules.

The exemption appears in the latest 816-page version of the fourth Capital Requirements Regulation and Directive, drawn up by the Council of the European Union (EU). In an earlier council draft, an exemption had been given to non-financial counterparties – which lawyers had interpreted

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: