WASHINGTON Aug 8 Market participants will have
until Oct. 22 to comment on proposed bank capital rules, the
Federal Reserve said on Wednesday, bumping the deadline back
from Sept. 7.
The rules, which enact an international agreement known as
Basel III, were put out for comment by the U.S. central bank in
June. They largely reject pleas by the U.S. banking industry to
soften parts of the new standards.
"The comment period was extended to allow interested persons
more time to understand, evaluate and prepare comments on the
proposals," the Fed said in a statement.
Basel III is the cornerstone of efforts by international
regulators following the 2007-2009 financial crisis to make sure
the global banking system is more resilient.
The new standards would force banks to rely more on equity
than debt to fund themselves so that they are able to better
withstand significant losses.
The announcement comes a day after a group of state banking
organizations asked the three regulatory agencies that proposed
the rules for an extension.
"We want to provide and need to provide you with the very
best information possible," the bankers wrote to the Office of
the Comptroller of the Currency, the Fed and the Federal Deposit
Insurance Corporation. "Our members will find it difficult in
the extreme to provide that kind of quality and necessary
information to you by September 7, 2012."
It is up to each country to write rules to implement the
Basel agreement for its banks.
The accord, which is to be phased in from 2013 through 2019,
will require banks to maintain top-quality capital equivalent to
7 percent of their risk-bearing assets, about three times what
they are required to hold under existing rules. The Fed proposal
adheres to this standard.
U.S. banks have pushed regulators to allow them to more
heavily count mortgage servicing rights and the unrealized gains
and losses of certain securities toward their capital
requirements than allowed by Basel III, but the Fed's draft rule
closely follows the international agreement.