23 August 2017
Visit http://response.ncr.com

Apcims warns of Basel threat to securities business

10 July 2003  |  3632 views  |  0 Angela Knight

The greatest single operating cost of UK investment firms could more than double under the latest European proposals on regulatory capital according to the UK's Association of Private Client Investment Managers (Apcims).

Speaking at a City conference today, Apcims chief executive Angela Knight (pictured) said that although the European Commission's latest draft of its new Capital Adequacy Directive is an improvement for companies defined as "simple" investment firms, its complicated formula still leaves many non-banks caught in a regime designed for the banking industry.

The result will be completely disproportionate increases in costs for many investment firms, she told delegates to the Security Industry Software Association conference in London.

The Directive seeks to apply the Basel rules devised for large international banks on all of Europe's financial industry. Although its stated aim is to devise a system which is more closely related to risk, its basic assumption is that all firms are banks or bank look-alikes, says Knight.

"It's like putting a six-year-old girl in a size 18 party frock. It fits nowhere, it covers everything several times over and it keeps tripping her up every time she tries to move. Additional costs, not justified by additional risks, simply mean that the customer will pay more for no extra benefit."

A similar argument was made recently by the US Securities Industry Association, which called for national regulators to have discretion in the application of the rules to securities firms.

Says Knight: "Investment firms have to have their own tailored regime. It cannot be right to burden them with the same capital requirements as internationally active banks."

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

SIA adds to US clamour over Basel

SIA adds to US clamour over Basel

27 June 2003  |  3797 views  |  0 comments
Financial services falling behind on Basel II

Financial services falling behind on Basel II

16 June 2003  |  5695 views  |  0 comments
Risk IT budgets bucking the downturn

Risk IT budgets bucking the downturn

14 May 2003  |  4134 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
download the paper nowvisit www.dorsum.euvisit www.worldpaymentsreport.com

Top topics

Most viewed Most shared
Rabobank constructs physical model to understand IT architectureRabobank constructs physical model to unde...
16604 views comments | 40 tweets | 76 linkedin
Mobile contactless spending accelerating in UKMobile contactless spending accelerating i...
13111 views comments | 28 tweets | 23 linkedin
Barclays pairs banking data with third party apps for SmartBusiness DashboardBarclays pairs banking data with third par...
11745 views comments | 22 tweets | 34 linkedin
Australia regulates digital currenciesAustralia regulates digital currencies
10957 views comments | 21 tweets | 35 linkedin
RBS to bring Silicon Valley to EdinburghRBS to bring Silicon Valley to Edinburgh
10846 views comments | 10 tweets | 8 linkedin

Featured job

Find your next job