A planned international limit on bank indebtedness will be on the agenda of every meeting of the Basel Committee on Banking Supervision this year as regulators seek to wean lenders off their addiction to debt, according to three people familiar with the talks.
Investors in 262 billion euros ($347 billion) of Dutch residential mortgage-backed securities risk being penalized by new bank liquidity rules, even as the securities prove among the safest home-loan bonds globally.
Twenty percent of Europe’s biggest banks would have failed to meet global capital standards, known as Basel III, as of June 2011, the European Banking Authority said in an impact assessment of the planned rules.
International regulators will next week consider allowing contingent convertible bonds to count toward additional capital requirements for systemically important banks whose failure would roil the global economy.
The Basel Committee on Banking Supervision will next week consider the need for changes to capital surcharges on the biggest banks amid warnings from lenders that the measures may stymie the financial system’s recovery, according to two people familiar with the talks.