'No-deal' Brexit would make UK banks add risk weight to EU bonds

Brexit and the City

UK banks face capital charges for risky European Union sovereign exposures following a 'no-deal' Brexit, according to a newly published government proposal. 

Currently, the EU’s Capital Requirements Regulation (CRR) applies a 0% risk weight to EU government bonds under the standardised approach to credit risk, and also allows all banks – even those using internal models for other types of credit risk – to use the standardised approach for sovereign exposures. This means EU banks can currently

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