consultative paper proposed revisions in the global capital accord, changes of capital adequacy requirements for credit and market risk have got the lion's share of attention. But buried deep in the 62-page document was a new proposal that significantly expands the scope of the capital adequacy framework.

The proposal requires banks to set aside capital for potential losses arising out of operational risk, which could cost the industry billions of dollars -- as much as $126 billion for the 100 largest world banks alone.

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