The international regulatory community will determine whether Basel III rules that require banks to hold additional capital to cushion against economic blows should be simplified, following criticism from some regulators that the rules are too complicated.
Stefan Ingves, the chairman of the Basel Committee on Banking Supervision, said that “vigorous debate” had begun over whether Basel III rules are easily applicable and advanced enough to protect global economies from financial disaster, Reuters reports.
FDIC Director Thomas Hoenig and Andrew Haldane, the director of financial stability at the Bank of England, have said that Basel III rules are much too complicated to work effectively, leading the committee to reconsider and review its rules.
The committee will meet on Wednesday and discuss the possibility of a review, but Ingves said that the criticisms should not warrant a delay of the rules’ implementation.
“It is too early to say how we will take this work forward,” Ingves said, adding that some supervisory changes could be made, according to Reuters. “And others might necessitate a deeper, long-term review before we can decide on any solution.”
Basel III rules were released in January but will take six years to be fully implemented, though the European Union and U.S. have yet to begin implementation of the rules.