Some of the world's biggest banks have struggled to meet the capital requirements defined by Basel III. The committee, which aims to tighten its rules further and has now met opposition from an unexpected corner.
The capital requirements for global big banks, known as Basel III, were supposed to be tightened by year-end. Minimum capital standards in particular were thought to be tabled for an increase by the Basel Committee on Banking Supervision.
Today, it is questionable whether the reform will be enacted as planned for. A group of central bank presidents has cautioned the Basel committee to keep its pledge not to significantly increase how much capital banks will need to hold to guard against potential losses, «The Wall Street Journal» reported (behind pay-wall).
Removing Uncertainties
Officials in Basel, the seat of the Bank for International Settlements, have said that the proposed changes were aimed at creating more consistency among banks, according to the «WSJ».
But as the banking crisis has become more acute again in Europe, such measures have become more difficult to enforce.
The central bank presidents urged the completion of the capital rules by the end of the year to remove any uncertainties remaining in the industry.
