It would apply the most sophisticated option to the largest U.S. organizations for which better risk measurement and risk management are most critical. It permits U.S. organizations that wish to choose the more-sophisticated approaches to do so.
But it avoids additional costs and burdens on most U.S. banking organizations - those that have less pressing needs for improved risk-management techniques and already have high capital positions, are effectively subject to Pillar II supervisory oversight, and disclose considerable information.