Basel Committee moots changes to leverage ratio

The Basel III leverage ratio could be amended to mitigate a possible unintended impact on the central clearing of derivatives.

Standard-setters are concerned that current rules overly penalise banks’ clearing businesses. At present, initial margin cannot be deducted from exposures, generating heavier capital requirements that some firms view as unfair.

The Basel Committee on Banking Supervision published a consultation on October 18, setting out three possibilities. Maintaining the status quo