The banking industry has faced unprecedented change in the last few years with increased consumer action, new technology and an ever competitive marketplace. This, coupled with the relentless pace of regulatory and accounting changes in the UK, has left the sector exhausted. Basel II is one such change which has involved a major investment on the part of those institutions required to adopt it. The impact will be felt far wider as credit models used to assess the creditworthiness of obligors have been developed for the corporate and retail sectors alike. This article seeks to establish what those impacts might be.
