Basel official sees bank impact study by year-end

Banks should get a clearer picture within the next six weeks about the worldwide impact of new capital rules, an official of the committee charged with drawing up the global Basel III regulation said.

"The Quantative Impact Study will be published before the end of this year," Stefan Walter, secretary general of the Basel Committee said at a banking conference in Frankfurt on Tuesday.

"The result will show the worldwide impact of Basel III on two groups: the big banks and the smaller banks."

The Basel Committee will publish an aggregate result for each group, including the mean and dispersion around the mean. "This will cover both the capital and liquidity ratios," Walter said.

Banks have argued that Basel III could restrict lending and thus hamper economic recovery but central bankers have said the concerns are being overstated.

The Basel Committee of global banking regulators will also present the final written text of Basel III by the end of the year. The measure was endorsed by world leaders last week.

The new requirements will be phased in according to the time lines already specified by the Basel Committee, starting in 2013 with completion by the beginning of 2019.

"In areas like the liquidity standards, we will put in place supervisory reporting and monitoring frameworks to assess the impact, both at the bank level and from a broader market perspective. If necessary, we will make appropriate adjustment," Walter said.

The official said he was confident that the new rules -- unlike its tarnished predecessor Basel II -- will go into effect in all big countries without delay.

"All Basel Committee members, including the U.S., have made a strong commitment to implement Basel III," Walter said.

[Source: Reuters, Frankfurt, 16Nov10]

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