Deutsche Bank AG, Europe’s largest investment bank by revenue, said it will sell at least 1.5 billion euros ($2.1 billion) of notes that can incur losses in a crisis, helping the firm meet stricter limits on leverage.
The first Basel agreement on global banking regulation, adopted in 1988, was 30 pages long and relied on simple arithmetic. The latest update, known as Basel III, runs to 509 pages and includes 78 calculus equations.
U.S. units of foreign lenders including Deutsche Bank AG may be required by regulators to comply with tougher capital rules that some banks sought to skirt, three people with knowledge of the discussions said.
European banks, rattled by investor uncertainty about their ability to withstand a sovereign-debt crisis, are poised to win a reprieve in Basel, Switzerland, this week as regulators from 27 countries shape new capital rules.
The Basel Committee on Banking Supervision softened some of its proposed capital and liquidity rules while introducing new restrictions on how much lenders can borrow in order to rein in their risk-taking.
The Basel Committee on Banking Supervision , nearing agreement on how to redefine capital and when to impose borrowing caps on banks worldwide, has left a final decision to its governing board, which meets next week.
The world’s largest banks won a reprieve of at least a year before facing extra measures that would force them to rein in risk as divisions within the Group of 20 nations delayed an agreement on such rules.