On March 31, ISDA and the Association for Financial Markets in Europe (AFME) submitted a joint response to the UK Prudential Regulation Authority’s (PRA) consultation on the implementation of the Basel 3.1 standards.
The implementation of the Basel 3.1 standards in the UK is a necessary element of preserving financial stability and provides an opportunity to review the framework more holistically, ensuring it is appropriately calibrated and takes account of the specificities of the UK market. It is crucial that the Basel 3.1 framework is implemented in a risk-sensitive way that results in a robust UK banking sector that is effective in financing the wider economy.
The consultation response includes proposals for targeted revisions to the output floor, credit risk, credit risk mitigation, credit valuation adjustment risk, standardized approach for counterparty credit risk, market risk and operational risk frameworks to improve the risk sensitivity of the requirements, reduce unnecessary burdens on firms and ensure that corporates and other end users are still able to access key financing, liquidity, and hedging services at a reasonable cost.
Documents (1) for ISDA Responds to PRA Consultation on Basel 3.1 Implementation
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Expanding Legal Agreement Coverage in the CDM
This paper examines the recent extension of the Common Domain Model (CDM)1 to represent two of the most significant, and previously undeveloped, areas of its legal agreement model: umbrella agreements and contract amendments. Umbrella agreements are widely used to document...
ISDA Omnibus Canadian Representation Letter
On September 2, ISDA published the Omnibus Canadian Representation Letter, which combines previously published representation letters drafted to assist firms in compliance with Canadian trade reporting, business conduct, regulatory margin and clearing classification rules. The Omnibus Canadian Letter is designed...
Joint Response on Cross-margining
On August 31, ISDA and FIA submitted a letter to the US Commodity Futures and Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) on the agencies’ joint request for comment on the implementation of portfolio margining and cross-margining...
Accounting for Carbon Credits: Latest Developments
This paper updates and extends the analysis set out in ISDA’s October 2023 paper on accounting for carbon credits. While preserving the original focus on the accounting treatment of voluntary carbon credits (VCCs) and compliance carbon credits (CCCs), it expands...