In conjunction with finalizing hard-fought changes to the global standardized approach, (SA) a decision to delay the fundamental review of the trading book, and new operational risk-based capital standards, the Basel Committee has completed changes to the internal ratings-based (IRB) models-based approach to credit risk and an even more controversial output floor limiting IRB reliance.  With all of these actions, Basel completed what it calls the Basel III Accord.  Many have, though, styled it now Basel IV because the sum total of these changes reallocates the balance between the SA and IRB to reduce some of the burden of the initial approach to standardized capital requirements while increasing global standards for many banks using the IRB.  IRB reliance is often selected to drop risk-based capital (RBC) weightings well below standardized requirements.  Doing so is not possible in the U.S., where banks with assets over $250 billion must use the advanced IRB (or A-IRB not the foundation one also allowed in the global rules) and hold the higher of the SA or IRB requirements.

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