International bank capital requirements will be delayed by one year – to January 2023 – following a decision Friday designed to give the industry more breathing room during the coronavirus crisis.
The decision by the Basel Committee on Banking Supervision moves the deadline for implementation of the new rules – which affect an array of lending and investment decisions made by banks around the world, including mortgages and derivatives – from January 2022.
“It is important that banks and supervisors are able to commit their full resources to respond to the impact of Covid-19,” said François Villeroy de Galhau, chairman of the Basel Committee’s oversight body, in a statement. “This includes providing critical services to the real economy and ensuring that the banking system remains financially and operationally resilient.”
According to a report in Bloomberg Law, European regulators were ready to begin enforcing the new rules in a little more than 19 months, and taking steps to do so. Banks have pushed back on the regulations.
Also according to the report, the regulations are now set to be phased in between January 2023 and January 2028. A new set of capital rules for trading desks – known as the Fundamental Review of the Trading Book – will also start in January 2023, the report stated.