EU TO RAISE CAPITAL RESERVE RATIO FOR BANKS

Europe’s biggest banks could see the amount of capital they are required to hold in reserve more than double. Current plans due to be fully implemented within the next seven years could require banks to hold a minimum of 7% of core capital to act as a buffer against potential losses. However, the EU is now considering requiring the banks to have as much as 17% in reserve in an attempt to avoid another Lehman style bank collapse. The Treasury is preparing a White Paper on new capital rules for UK banks that is expected to be published soon. It will pave the way for putting into law the recommendations of the Independent Commission on Banking for restructuring the UK banking industry. Under the rules, British retail banking businesses would be required to maintain a minimum core capital ratio of 10%, to ensure that retail deposits are not put at risk in a future crisis. http://straightalkdebt.com/