ISDA/AFME respond to EBA consultation on internal models for market risk

On March 11, 2016, ISDA responded jointly with the Association for Financial Markets in Europe (AFME) to the European Banking Authority (EBA) consultation on assessment methodology on the use of internal models for market risk. The ISDA/AFME response notes the number of areas in the draft regulatory technical standards where the EBA sets out overly prescriptive criteria, highlights the need for sufficient supervisory discretion to reflect the diversity of EU regulated banks, and suggests the avoidance of any contradiction with the Fundamental Review of the Trading Book framework, which banks may need to implement already in 2019.

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