CVA: the first sign of BCBS strategic change?-Reference-Cited by-同舟云学术

CVA: the first sign of BCBS strategic change?

Published:2015-07-13 Issue:3 Volume:23 Page:230-251
ISSN:1358-1988
Container-title:Journal of Financial Regulation and Compliance
language:en
Short-container-title:

Author:

Viljanen Mika Veli-Pekka

Abstract

Purpose – The purpose of this paper is to aid understanding of the changes in Basel Committee on Banking Supervision (BCBS) regulatory strategies after the global financial crisis. Design/methodology/approach – The author uses the credit valuation adjustment (CVA) charge reform as a test case for inquiring whether BCBS has departed from its pre-crisis facilitative regulatory strategy path. The regulatory strategy of the CVA charge is discussed. Findings – The charge exhibits a new regulatory strategy that BCBS has adopted. It seeks to manipulate market structures by imposing risk-insensitive capital charge methodologies. Originality/value – The paper offers a new heuristic to analyse regulatory initiatives and their significance. The CVA charge has not been subject to a regulatory theory-based analysis in prior literature.

Publisher

Emerald

Subject

Strategy and Management

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