Basel II and the Capital Requirements Directive[ fr ][ de ] Published: Thursday 23 June 2005 | Updated: Thursday 9 October 2008 Rules on capital requirements are designed to protect savers and investors from the risk of the failure or bankruptcy of banks. They ensure that these institutions hold a minimum amount of capital. The Capital Requirements Directive was adopted in 2006 and is currently under review. October 2008: The European Commission proposed a review of the Capital Requirement Directive Capital adequacy rules set down the amount of capital a bank or credit institution (CI) must hold. This amount is based on risk. There are all sorts of financial instruments available by which credit institutions can guard against risk (risk mitigation), such as derivatives, futures, corporate bonds and asset-backed securities....
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