Cherry-Picking Season
As we noted in our assessment of Basel’s new leverage-ratio denominator, a still more critical section of the new global package for mortgage finance is in the revised standardized approach (SA). Reflecting relentless pressure from Nordic banks, the new global accord goes very, very easy on residential mortgages. Here, we assess the extent to which the U.S. will adhere to this approach. If it does, then portfolio lending will see a new day a’dawning.