Banking agencies back conclusion of Basel reform

Support for the conclusion of efforts to reform the international bank capital standards initiated in response to the global financial crisis was announced Thursday by the federal banking regulatory agencies.

In a joint release, the Federal Reserve, FDIC and the OCC noted that the Governors and Heads of Supervision and the Basel Committee on Banking Supervision Thursday announced the finalization of the reforms to the “Basel III” agreement on bank capital standards. With the agreement, the agencies said, the Basel Committee will bring to conclusion the international reformer initiated in response to the global financial crisis.

“The Basel III agreement, which was designed for internationally active banks, was introduced in 2010 and was instrumental in establishing revised minimum standards that increased both the quality and quantity of regulatory capital. The reforms finalized today are intended to improve risk sensitivity, reduce regulatory capital variability, and level the playing field among internationally active banks,” the regulators said.

The agencies will consider how to appropriately apply these revisions to the Basel III reform package in the United States and any proposed changes based on this agreement will be made through the standard notice-and-comment rulemaking process, they added.

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