FT Alphaville " Cooking (CDOs) with SocGen Posted by Tracy Alloway on May 03 16:50. Take one seasoned collateralised debt obligation Crack it open. Sell the underlying constituents. Garnish with yield. So "Cooking with SocGen" is probably not coming to a book store near you anytime soon. But we're sure it would be a good insight into Basel III preparations currently being employed by banks. As SocGen chief financial officer Bertrand Badré said on Thursday's conference call: The objective today is the road map to Basel III. As we say, it's not always a question of risk-weighted assets, it's a question of deduction. Again, if I take the example of the cracking of CDO, you to try to think yourself a question, the cracking of CDOs have several impacts. First of all, you can, at the end of the day, more easily sell the underlying assets. But on top of that, you don't have the negative impact of securitization deduction from your capital. So it's not so much risk-weighted assets impact than Basel III positive impact. So it's a little bit of cooking... Yum. Related links: Europe's banks will find ways to recapitalise - FT Group clashes with regulators on bundled debt - FT This entry was posted by Tracy Alloway on Thursday, May 3rd, 2012 at 16:50 and is filed under Uncategorised. Tagged with Basel III, CDOs, Risk-weighted assets, securitisation, securitization, societe generale.