Group Stage 17 September: Drew with CSKA Sofia 1-1 (a) In Bulgaria, Diomansy Kamara scored only three minutes after Fulham had gone behind, although CSKA were to prove the weakest team in the group. 1 October: Beat Basle 1-0 (h) Against the Swiss, Murphy scored to maintain good progress in the group.
Basle 2 (which sets minimum standards of capital adequacy, but is not legally binding) is meant to apply from January 2004.
British regulators are working frantically on ways to apply bits of Basle 2 within existing EU law.
Basle 2 must be turned into a third capital-adequacy directive (CAD 3), which may overlap with a bunch of other directives on solvency, large exposures and capital.
So long as banks reach that 8% floor, they can start applying Basle 2 principles to any capital charge above the minimum, without infringing existing EU law.
All of this must happen before January 2004, when Basle 2 is meant to be ready.Basle 2 has problems of its own, to do with the calibration of risk, and with fierce and sometimes philosophical arguments about the definition of operational risk.
While that is under way, it is dangerous to translate the Basle framework (the new version is called Basle 2) into European law in the form of a new capital-adequacy directive (called CAD 3).
So this is not a good time to be enshrining raw and untested concepts into European law.The European Commission's consultative document, adapted from Basle 2, invites comment by May 31st.
Supervisors hope that Basle 2 will reduce such distortions.The nightmare on the other side of the duvet is the task of translating a regime which is still evolving and which is aimed at the top tier of international banks—into European law for all financial firms.
It has the same ambitious plans for risk measurement, but it also highlights the special need for banks to finance small and medium-size enterprises (SMEs), most of which have no public credit rating (Basle 2 relies on public ratings as well as ratings used internally by banks).
"What we need", mused a British regulator this week, "is a rolling directive .British regulators are concerned that the European Commission may not meet the 2004 deadline, leaving London-based banks unable to apply Basle 2 in step with the Americans, Japanese and other non-EU banks.
