Basel

Basel: Second Working Paper on Securitisation

Jonathan G F Walsh, Norton Rose, London

Following a significant period of industry consultation in relation to the original working paper produced by the Basel Committee on Banking Supervision (the “Committee”) in October 2001 (the “First Working Paper”), the subsequent working paper, entitled the “Second Working Paper on Securitisation” (the “Second Working Paper”), was published at the end of October 2002. Comment was invited by the Committee from industry participants no later than 20 December 2002. Accordingly, there was not a great deal of time to review and comment on a standard which is likely to have a significant impact on the capital treatment of securitisation both for investing and for originating financial institutions. This article examines briefly the changes and developments made in the Second Working Paper and the issues surrounding the proposal for the capital treatment of asset securitisations.