The New Capital Accord

The purpose of this article is to consider the content and importance of the final proposals produced by the Basel Committee for the reform of capital adequacy. In light of the number and length of the consultation documents produced, this article will be in two parts.The second part will be produced in next months journal.

Dr G A Walker. International Banking and Finance Law Unit, Centre for

The Basel Committee produced its revised set of capital rules for national and internationally active banks at the end of January this year (see “New Accord,” FRI (February 2001), p. 1).An impressive collection of revision documents was released which provides a detailed and extended examination of modern bank and supervisory practice in this area.This is a significant achievement especially in light of some of the earlier negotiation difficulties which arose (see “So close but so far,” FRR , May 1999, p. 1).