Hence, these banks already employ sophisticated risk-management practices and internal economic capital models. I fully support our proposal to review carefully these practices and models, among other factors, before granting the required supervisory approval for individual banks to use the advanced approaches of Basel II. Determining the right level of complexity for U.S. Basel II rules remains an issue.
While many bankers support the issuance of so-called principles-based regulations, some bankers have expressed a desire for more detail on certain aspects of the Basel II proposals in order to reduce uncertainty about what will be acceptable practice and what will not. My view is that these are not necessarily contradictory approaches.