Leverage ratio as high as 5% could yield net benefits, BIS economists say
There is ‘considerable room for manoeuvre’ in setting leverage ratio
Regulators have plenty of room to increase the leverage ratio beyond the Basel III minimum of 3%, research by economists at the Bank for International Settlements (BIS) has found.
Published as one of the supplementary articles in the BIS quarterly review on November 6, the study attempts a cost-benefit analysis of different values of the leverage ratio.
The BIS's head of financial systems and regulation Ingo Fender and economist Ulf Lewrick find the optimal value to be 4–5%, with the benefits
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