FRTB Banking Book / Trading Book Boundary

Previously banks had considerable discretion is designating positions as “held for trading” to gain Trading Book treatment for market risk capital.  This changes under the FRTB where certain activities and products are automatically deemed trading while others are automatically deemed banking and certain products are presumed trading but firms can apply to their regulator for permission to deviate from this.  Anything not covered above is banking under the new rules.  Here’s a diagram describing the new designations.