Basel: who are the winners and the losers?

Who are going to be the winners and losers after the introduction of the new Basel accord? A widespread but misguided view is that the new accord is all about changes to regulatory capital requirements and that the winners will be the banks who achieve the greatest reduction in their capital requirements. Alistair Milne explains why this view is mistaken and discusses how banks can achieve real commercial advantages from their implementation of the new accord by concentrating not on reducing capital requirements but on improving risk management and business decision making.