News 20 Apr 2023

Proposed changes to Basel III

On 18 April, CER, Allrail, ERFA, the Rail Working Group, UIC and UIP co-signed a letter to the EU policymakers in charge of agreeing Commission proposal COM (2021) 664 for a Regulation as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor (aka Basel III). 

The proposed changes to Basel III in relation to object-based financing are of critical importance to railways considering the need to empower private investors when it comes to financing the rail sector and, more specifically, the procurement of rail rolling stock. Such investment is vital in order to reach the modal shift objectives of the EU Strategy for Sustainable and Smart Mobility. With EU and national public budgets stretched to their limits under the impact of recent economic crises, banks and credit institutions are destined to play in this context an increasingly significant role in the coming years.

The associations' joint letter calls on the EU Institutions to consider several key aspects when negotiating the final text of the Regulation.