Greenspan sees improving banks' risk measurement moderating business cycles

verfasst von Der letzte Grund, 18.05.2001, 20:16

News Aktuell am 18 Mai 2001 um 20:07

Greenspan sees improving banks' risk measurement moderating business cycles
WASHINGTON (AFX) - U.S. banks are beginning to manage the task of
fundamental risk assessment, and this should eventually help moderate swings in
business cycles, said Federal Reserve Chairman Alan Greenspan.
"The formal measurement and quantification of risk (in the U.S. financial
sector) has begun to occur (and) this is a sea change, or at least the beginning
of one," Greenspan said in remarks prepared for delivery to a banking
supervisors' conference.
He explained that in recent years banks have tended to ease loan standards
during periods of high growth, only to tighten them once economic conditions
deteriorate.
This type of pro-cyclical pattern of loan management over time runs counter
to"the best interests of the economy (and) the bank's shareholders," Greenspan
said.
However, the introduction of risk classification systems for loans, and
explicit adjustments to address risk, should moderate this pattern, he said.
The effort by international bank supervisors through the Basle capital
accords process to boost risk management also"promises less variability in
loans over the cycle," he added.
Greenspan did not discuss current economic developments or monetary policy
in the prepared remarks.
cxa/gc


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• Greenspan sees improving banks' risk measurement moderating business cycles - Der letzte Grund, 18.05.2001, 20:16
  • Pars pro toto -ein Gedankenspiel - El Sheik, 18.05.2001, 21:23
    • Re: Pars pro toto -ein Gedankenspiel - Oldy, 18.05.2001, 23:35