There were a couple of surprises in the series of announcements yesterday morning by APRA and banks over the accreditation, to some extent, of some banks to make use of one or other of the "advanced" approaches to calculation of capital for regulatory purposes under the Basel II regime that comes into force next month.The key decision by APRA is a ruling that three banks may apply the internal ratings-based approach to credit risk and the advanced measurement approach to operational risk, to use a lot of jargon.These three are ANZ, Commonwealth and Westpac.Macquarie Bank received clearance to apply the "foundation" internal ratings-based approach to credit risk (and more on that in the next article).Bank of Western Australia, which wanted to apply the advanced approach on credit risk, won't be allowed to do so by APRA for the time being but will be able to apply the advanced approach on operational risk from January 1. BankWest will apply the existing Basel I approach in the interim.National Australia Bank did not want to apply any of the advanced approaches for credit risk from January 1 but hopes to catch up in the second half of 2008. NAB will apply the advanced approach on operational risk.St George Bank will also remain on Basel I during 2008 and may shift to the Basel II version in 2009 in most areas.Those banks aiming for advanced Basel II compliance at a later date won't be working out their capital on the basis of the standardised version of Basel II that applies to smaller banks, presumably as their project teams aimed for the former and didn't undertake the programming and reporting methods needed to conform to the latter.The controversy arising from all the above is that NAB and BankWest will be working out capital requirements under the old Basel I formula that is intended to capture a relevant capital charge for operational risk, even though it's based on credit exposures.So if NAB and BankWest also work out a capital estimate under the advanced approach for operational risk (as APRA has said they may, and so must) does this mean they'll be carrying a double capital load?One reason some bankers and advisers were scratching their heads yesterday was that APRA had said in the past (perhaps in the deep past) that the half way house agreed to yesterday would not be an option for banks.