via Global Trade Review by Jacob Atkins
Proposed changes to US bank capital rules could make supply chain finance less attractive for large lenders and more expensive for corporate users, BAFT (the Bankers’ Association for Finance and Trade) has warned.
Under draft reforms unveiled in March, banks could be required to set aside 10% of supply chain finance (SCF) exposures as up-front capital due to a broadening of the definition of a bank’s “commitment” to extend credit, purchase assets or issue credit substitutes, Baft said in a comment letter to regulators seen by GTR.