Business News
Basel chief says tougher banking rules must be enforced
Sep 22, 2010, 9:57 GMT
Singapore - Proposed new banking rules designed to make the industry more resilient must be enforced rigorously, the chairman of the group that drafted the measures said Wednesday.
The so-called Basel III standards 'must be effectively implemented and enforced,' even though they may be tough, said Nout Wellink, chairman of the Basel Committee on Banking Supervision.
'We must remember that memories fade quickly,' he told a conference of international senior bank officials in Singapore.
The Basel III standards include higher capital requirements for banks to protect against future losses.
The proposal comes two years after the collapse of US investment bank Lehman Brothers pushed the global economy into its deepest recession since the 1930s.
The new measures are set to be considered for approval by the Group of 20 summit of major economies in South Korea in November.
Since the height of the financial crisis, 'the financial and banking system have been stabilized and we are on the road to recovery,' Wellink said.
'If, prior to the crisis, banks had the levels of capital we are [now] asking for, we likely would not have experienced such a deep crisis,' said Wellink, who is also president of the central bank of the Netherlands.
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