Banks’ Worst Fears Eased as Basel Soft-Pedals Capital Overhaul
By Boris Groendahl & Silla Brush
Global banking regulators pledged to refrain from further tightening capital requirements with new rules to be finalized in 2016, dispelling industry fears that triggered intense lobbying efforts over the past year. The Basel Committee on Banking Supervision doesn’t plan to raise capital requirements across the board in the remaining projects of its post-crisis bank rule overhaul, it said Jan. 11 after a meeting of its oversight body, chaired by European Central Bank President Mario Draghi. The group, which includes the Bank of England and U.S. Federal Reserve, said it will assess the potential costs of any additional action…. Karen Shaw Petrou, managing partner of Washington-based research firm Federal Financial Analytics Inc. said the Basel’s latest statement is a response to bankers’ warnings. “Global regulators clearly hope to tamp down continuing talk of a ‘Basel IV’ rule, emphasizing in both action and statements that continuing changes are recalibrations, not hikes,” Petrou said in an e-mail.