Bank of England warns about the need to increase the banks capital
2022.12.07 07:21
Bank of England warns about the need to increase the banks capital
Budrigannews.com – The Bank of England stated on Wednesday that by the end of the decade, applying the remaining set of global bank capital rules in Britain will result in an increase in capital requirements of approximately 6%.
After more than a decade of taxpayer-funded bailouts of undercapitalized lenders, the Basel Committee of banking regulators from the world’s major financial centers rolled out the first set of Basel III regulations.
After a public consultation that is currently underway, the final batch, which the BoE refers to as Basel 3.1, will be implemented in January 2025 and will affect lenders such as HSBC and Barclays (LON:), Lloyds of London likewise NatWest
Phil Evans, director of the BoE, stated that the consultation is a significant event that will take into account Britain’s competitiveness while adhering to high international standards because Brexit gives Britain the ability to create its own financial regulations.
According to Evans, banks’ capital requirements will rise by approximately 6% under Basel 3.1.
Evans stated at a UK Finance event, “All in all, the impact will be limited until the mid-to-late 2020s, and we think that Basel 3.1 will increase capital requirements by a small amount on average across UK firms by 2030 and full phase in.”
He stated that it was difficult to establish a precise figure at this time due to the fact that certain factors will reduce the impact.
He added, “And we’re giving firms ample time to adjust.”
