Basel Regulators Ease Leverage-Ratio Rule for Banks

Bloomberg

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Stable Funding

The Basel group brings together regulators from 27 nations including the United States, U.K. and China to coordinate rule-making.

The regulators also published an updated draft of another liquidity rule, known as a net-stable funding ratio, or NSFR, aimed at requiring banks to finance longer-term lending with sources that are unlikely to dry up in a crisis.

The changes relax some elements of the rule while toughening others. The amendments "will help to identify less stable funding structures" and spur banks "to develop more robust funding profiles," Stefan Ingves, the Basel committee's chairman, said.

The Basel committee said it will seek views on the NSFR plans until April 11 and will finish work on them by the end of this year. The NSFR is set to become a binding rule in 2018.

Global regulators diluted a planned debt limit for banks amid warnings that the rule would penalize low-risk financial activities and curtail lending.

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