It reveals that more than half of the savings banks, and roughly two-thirds of the credit cooperatives, are now exposed to heightened interest rate risk. I’m not saying that’s necessarily a bad thing – after all, taking on that kind of risk is one of the functions they perform in the economy.
Nevertheless, I should give credit to the IASB, as IAS 39 already incorporates important concepts such as recognising impairments in groups of loans and applying experienced credit judgment to the determination of impairment. But they can still do better. 18.