The European Commission's own think tank has therefore written quite rightly in a recent paper that "zerorisk weighting of sovereign debt in the EU, as well as the exemption from existing large exposure requirements, are a source of vulnerability."
I have therefore been advocating, for quite some time, the abolition of the preferential treatment of sovereign borrowers and welcome the fact that this issue is now also on the agendas of the relevant regulatory forums. There has been opposition to this proposal and that's hardly surprising.