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IPD models effects of slotting UK property loan book

By: Language: English Series: Property Week ; 78(39) 28 September 2012, 21(1) Publication details: 2012Subject(s): Summary: IPD has published the first study of the Financial Services Authority's (FSA) new slotting measures designed to ensure banks have enough cash set aside to cover losses on property lending. IPD used real data from its databank classifying 3 442 loans totalling £56.6bn in value according to FSA categories. The study shows that slotting provides disincentives for underwriting "strong"and "good" loans because much more capital has to be held on low-risk lending than is necessary.
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Journal article London Journal article L157237 (Browse shelf(Opens below)) 1 Available 157237-1001

IPD has published the first study of the Financial Services Authority's (FSA) new slotting measures designed to ensure banks have enough cash set aside to cover losses on property lending. IPD used real data from its databank classifying 3 442 loans totalling £56.6bn in value according to FSA categories. The study shows that slotting provides disincentives for underwriting "strong"and "good" loans because much more capital has to be held on low-risk lending than is necessary.