EU, US criticised over bank rules weaker than Basel-III

The US, European Union (EU) and Japan may fail to fully implement bank-capital rules drawn up to prevent a repeat of the financial crisis that followed the 2008 collapse of Lehman Brothers Holdings Inc, global watchdogs warned today.

International teams of regulators have found weaknesses in the nations’ implementing measures for the so-called Basel-III standards, the Basel Committee on Banking Supervision said in a statement on its website.

Preliminary assessments of the EU, US and Japan “have identified areas of divergence between domestic regulations and the Basel standards,” the group said in a statement on its website. There are “key areas where domestic implementation may be weaker than the globally-agreed standards.”

Nations face a January 2013 deadline set by the Basel committee for implementing the new rules, which more than triple the core capital that lenders must have to stave off insolvency, and require banks to build up buffers of easy-to-sell assets. The measures were published by the group in 2010.

EU and US regulators have said that they will be vigilant in policing how each party applies the standards, which are scheduled to take full effect in 2019.