topics
tools
Expatica countries
Index Last Var.(%)
BEL 20 3083.51 0.32
DAX 9605.08 0.17
IBEX 30 10058.5 -1.04
CAC 40 4387.61 -0.20
FTSE 100 6806.86 -0.05
AEX 397.5 -0.20
DJIA 16272.65 0.46
Nasdaq 4318.933 0.63
FTSE MIB 20298.33 -0.11
TSX Composite 14214.35 0.18
ASX 5415.4 -0.10
Hang seng 22836.96 0.04
Straits Times 3110.78 0.45
ISEQ 20 836.3 0.23
EUR / USD 1.37976 0.67
EUR / GBP 0.82571 0.59
USD / GBP 0.598544 -0.10
Gold 1329.6 -0.13
Oil 108.9 -0.76
Silver 21.28 0.08
You are here: Home News Swiss News Global regulator eases liquidity rules for banks
Enlarge font Decrease font Text size


06/01/2013Global regulator eases liquidity rules for banks

The world's top banking regulatory body on Sunday eased the first global liquidity rules scheduled to start applying to banks in 2015 and aimed at improving their ability to survive financial crises.

The Basel Committee on Banking Supervision said at a press conference here that it had widened the definition of the easy-to-sell assets that banks will have to hold to survive periods of stress.

The Basel III standards had been initially proposed in 2010 but banks and financial institutions have since lobbied intensely to make the rules more flexible and result in lower costs for the sector.

The details of the Liquidity Coverage Ratio (LCR), which was drafted to avoid a repeat of the 2008 banking crisis and unanimously endorsed on Sunday by the Basel group's top oversight body, give the banks a reprieve.

Its provisions include a much broader definition of the minimum assets every bank needs to hold, making it less costly for them to maintain the required buffer.

"The changes to the definition of the LCR, developed and agreed by the Basel Committee over the past two years, include an expansion in the range of assets eligible as HQLA (high quality liquid assets)," the committee said.

The new LCR's full details will also be fully implemented only in 2019, instead of 2015 as initially proposed.

"Specifically, the LCR will be introduced as planned on 1 January 2015, but the minimum requirement will begin at 60%, rising in equal annual steps of 10 percentage points to reach 100% on 1 January 2019," the Basel group announced.

Mervyn King, Chairman of the Basel group's top oversight body and Governor of the Bank of England, described the agreement announced Sunday as "a very significant achievement."

"For the first time in regulatory history, we have a truly global minimum standard for bank liquidity," said King.

The Basel Committee brings together representatives regulators from 27 nations.

"Importantly, introducing a phased timetable for the introduction of the LCR, and reaffirming that a bank's stock of liquid assets are usable in times of stress, will ensure that the new liquidity standard will in no way hinder the ability of the global banking system to finance a recovery," King said.

Stefan Ingves, chairman of the Basel Committee and of Sweden's Sveriges Riksbank, said the global regulator could now focus on the Net Stable Funding Ration, another pillar of the Basel III reforms.

"The completion of this work will allow the Basel Committee to turn its attention to refining the other component of the new global liquidity standards, the Net Stable Funding Ratio, which remains subject to an observation period ahead of its implementation in 2018," he said.



© 2013 AFP


0 reactions to this article

0 reactions to this article

Discussion Forums

Community Noticeboard Switzerland

Canadians in Switzerland

Community Noticeboard Switzerland

News! Finally! English dentist in Basel

Community Noticeboard Switzerland

Want to meet new people?

Community Noticeboard Switzerland

we produce High Quality passports, Drivers License, ID cards

Student forum Switzerland

Survey

participate in the forums

 
 
 
 
 
Inside Expatica
Residence and work permits in Switzerland

Residence and work permits in Switzerland

How to apply for a residency or work permit in Switzerland for you and your family.

How to rent and buy a house in Switzerland

How to rent and buy a house in Switzerland

Information about renting property and obtaining a mortgage in Switzerland.

Switzerland's healthcare system

Switzerland's healthcare system

Information about the Swiss healthcare system, health insurance, pharmacies and emergency numbers.

Banking in Switzerland

Banking in Switzerland

Explaining Swiss currency, banknotes, credit cards and bureaux de change.