Consolidation of banks' balance sheets: aggregation of risk-bearing assets as a method of supervising bank solvency
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Topics:
Definition of capital
Introduction
Supervisory authorities all over the world have become increasingly aware in recent years of the need, in assessing the soundness of banks and the adequacy of their capital, to take into account the totality of their business at home and abroad. The aim of this paper is two-fold: first, to set out the reasons why.the Committee considers that the aggregation of banks' risk-bearing assets is an important instrument of banking super vision, and the conclusions which it has drawn from this analysis; and second, to describe present practices in this area.