The Bank for International Settlements is proposing modifications to one of the two ways banks can compute their regulatory capital—the so-called “standardized approach” to measure risk. (The other approach is based on a bank’s use of an internal model approved by the bank’s supervisor.) In connection with this, BIS is proposing specific modifications to the way banks measure their credit risk. Among other things, BIS proposes that banks reduce reliance on external credit ratings, and instead evaluate exposure by referencing more meaningful measures. For example, instead of risk weighting exposure to other banks by reference to their credit rating or sovereign of incorporation, reference would be to the other banks’ capital adequacy and asset quality. The risk weight would be derived from a look-up table applying these two criteria. Likewise, corporate exposure would no longer be measured by reference to the borrowing firm’s credit rating, but instead be a function of the borrower’s revenue and leverage. Similarly, the risk weight would be determined from a look-up table using these two drivers. Comments on BIS’s proposals are due by March 27, 2015.