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Radical action to fight credit crisis disc
and the methodologies used to derive them.

This would include standardised disclosure of exposures to collateralised debt obligations, residential and commercial mortgage-backed securities, leveraged finance, exposure to off-balance sheet entities and capital and liquidity resources. One party present said there was widespread interest in this idea.

The FSF proposed temporarily suspending capital and reporting rules that tie prudential requirements to market values of securities.

Regulators could temporarily change capital rules under Basel II to allow trading assets to be treated as available-for-sale, reducing their impact on capital calculations.

Alternatively, regulators could temporarily relax regulatory capital minimums wholesale, the FSF said. It noted that an alternative approach would be to suspend accounting rules for some assets, but said this could “damage market confidence.”

Authorities could organise a consortium of long-term private investors to buy mortgage assets from banks, possibly with state “co-investment” or governments could buy assets outright.

The FSF argued that there were “signficant private and collective benefits to assisting financial institutions in remaining as going concerns” – rather than allowing them to fail and

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