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Global regulators may sap too much risk, complexity out of banking, OCC's Walsh says

Jun 22 2011 Ted Knutson, Compliance Complete

If they overreact to the financial crisis, international regulators may be in danger of trying to squeeze too much risk and complexity out of banking, acting Comptroller of the Currency John Walsh warned on Tuesday. Walsh spoke in London at a meeting of the Centre for the Study of Financial Innovation. "We don' know how all of these new approaches will work in practice," Walsh said after reciting proposals under Basel III and the Dodd-Frank Wall Street Reform and Consumer Protection Act, "how they may interact with one another and what their cumulative impact will be." Walsh said proposed capital surcharges for systemically important financial institutions may be overkill on top of the Basel III enhanced capital mandate. "Some modest addition to minimum capital may be appropriate to reflect systemic concerns at the very largest firms," Walsh noted, "but we should not lose sight of the fact that the other components of Basel III already have been calibrated with one eye on the

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