U.S. banks are protesting capital rules proposed by regulators to comply with international standards and have asked that rules for assessing risk in their assets be replaced with something easier to follow, Bloomberg News reported yesterday. As written, the plans could “hinder credit availability, dampen economic growth and harm the competitiveness of the U.S. banking system,” according to a letter sent by financial industry groups to the Federal Reserve, Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp. -- the agencies that released the Basel III proposals for a public-comment period ending yesterday. The regulators proposed a tighter bank-capital regime in June to comply with an international agreement drawn up by the Basel Committee on Banking Supervision. The measures, adopted after the 2008 global financial crisis, are meant to make banks less vulnerable in future emergencies. They call for all U.S. banks to maintain “loss-absorbing capital” of at least 7 percent of risk-weighted assets.
