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Record W238028358

Basel 2: Mixed Bag for Securitization

2001· article· en· W238028358 on OpenAlex

Why this work is in the frame

A frame that forgets how it found something cannot be audited. These are the routes that admitted this work.

aboutThe title or abstract carries a Canadian signal from the geographic lexicon.
no affNo Canadian affiliation: this work is invisible to an affiliation-only frame.
No Canadian affiliation. An affiliation-only frame, the usual design, would never have seen this work. It is one of the works that make the case for inverting the frame.

Bibliographic record

VenueABA banking journal · 2001
Typearticle
Languageen
FieldEconomics, Econometrics and Finance
TopicBanking stability, regulation, efficiency
Canadian institutionsnot available
Fundersnot available
KeywordsSecuritizationIssuerBusinessAsset (computer security)Basel IIICapital requirementCapital (architecture)Basel IIFinancial systemMarket liquidityFinanceEconomicsMarket economyComputer security
DOInot available

Abstract

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It will help issuers, but it has its costs, too If the goal of the Committee on Banking Supervision is to make it easier for institutions to manage risk, then nowhere is it more germane than in its focus on the burgeoning securitization market. The document known as the New Accord--Basel 2, for short--is certain to make it easier for major institutions to package more big deals and to make much more money, especially overseas. The new capital rules will have a greater impact in Europe than they will in the U.S. because the market for asset-backed securities is underdeveloped outside the U.S. and Canada. The Committee's asset securitization proposals are also getting more support from big than from smaller that might not be able to meet 2's intricate and costly capital requirements. For it's never been more clear that institutions need to spend money in order to make money. Basel 2 requires that a capital charge be assessed against a liquidity facility to support an asset sale, which had not been required before, says Stephen Grossnickle, managing director of securitization at The Royal Bank of Canada. Now will have to put up capital to provide that facility, he says, adding that banks that aren't as capital rich may be forced out of the securitization business. To blur the picture further, 2 has yet to be fleshed out, and, as all bankers know, the devil is in the details. Nevertheless, Basil 2 already is a document to be reckoned with, and it appears to be moving in the right direction, although not all by any means are happy with all its provisions. On the plus side, the proposed new rules should make it easier for asset-backed securities (ASBs) to compete with mortgage-backed securities (MBSs) in the marketplace. Also, the rules will give institutions a greater role in assessing credit risk, making it cheaper to bundle loans for securitization. It's the most far-reaching capital regulatory change to have occurred within recent memory, says Roger Coffin, partner with PricewaterhouseCoopers, who works closely with banking institutions in developing their 2 strategies. This is a sea change, not just a tweaking of the regulations. 2 will affect the whole market for securitizations, from credit cards to automobiles, trade receivables, capital leases, and anything that has a cash flow attached to it, although the impact will be felt less in mortgage loan securitizations because of Fannie Mae's and Freddie Mac's dominance in that arena. Also, Fannie and Freddie already have capital requirements in place that closely resemble the requirements outlined in 2. Since 1988, the Accord has been the risk-based capital standard for around the globe. The Committee's set of minimum ratios has become the primary tool of capital regulation and it has strengthened the safety and soundness of international banking and contributed to the achievement of competitive equality. The financial world, however, has changed dramatically, eroding the 1988 accord's efficiency. Credit risk exists in far more complicated forms today. 2 seeks to address this change by better aligning regulatory capital requirements with the real underlying risks. Importantly, 2 would put asset-backed securities on a more level playing field with other fixed-income products. It would accelerate a broader trend in which ABSs are gaining ground against mortgage-backeds. What new risk? The committee s proposals are directed toward that are acting as originators of assets to be transferred, as servicing agents to the securitized assets, or as sponsors or managers to securitization programs that securitize third-party assets. Under the proposal, investing in ABSs could see reduced risk weightings for highly-rated ABS positions, but issuing ABSs may face some new capital charges. …

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Full frame distilled prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.

metaresearch head score (Codex)0.002
metaresearch head score (Gemma)0.000
Version: codex-gemma-dda1882f352aValidation status: machine_predicted_unvalidated
Candidate categoriesInsufficient payload (model declined to judge)
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Theoretical or conceptual · Consensus signal: Theoretical or conceptual
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.318
Threshold uncertainty score1.000

Codex and Gemma teacher scores by category

CategoryCodexGemma
Metaresearch0.0020.000
Meta-epidemiology (narrow)0.0000.000
Meta-epidemiology (broad)0.0000.000
Bibliometrics0.0000.000
Science and technology studies0.0000.000
Scholarly communication0.0000.000
Open science0.0000.000
Research integrity0.0000.000
Insufficient payload (model declined to judge)0.0010.000

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.025
GPT teacher head0.237
Teacher spread0.212 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it