The Commission's proposals differ from the Basel Committee's review on the capital adequacy of banks in some aspects (see www.plcinfo.com "A new global bank capital adequacy framework", European Counsel Banking and Finance Industry Report 1999, 48). The institutional scope of the proposals is wider (for instance, it also catches domestic banks) and the level of detail in some areas has increased. Although they are principally of interest to the regulated institutions (banks and so on), changes to regulatory capital requirements have an impact on the margins charged to borrowers and a more sophisticated system for measuring credit risk may reward some borrowers while increasing borrowing costs for others.
Source: European Commission consultation document "A Review of regulatory Capital Requirements for EU Credit Institutions and Investment Firms", 22nd November, 1999 available at ttp://www.europa.eu.int/comm/dg15/en/finances Responses should be sent to the Commission by 31st March, 2000.