Monday, September 6, 2010

10 German banks will need fresh capital of U.S. $ 135 billion to adjust to new regulations

10 German banks will need fresh capital of U.S. $ 135 billion to adjust to new regulations : Ten largest banks in Germany, including Deutsche Bank AG and Commerzbank AG, the possibility of requiring U.S. $ 135 billion (105 billion euros) of fresh capital to adjust to new regulations set by the Basel Committee. Dirk Jaeger, a member of the German Banking Association (the Association of Banks Germany), states that the funding requirements associated with the proposed increase in tier 1 capital ratio at 10%. Tier 1 ratio is a measure of the ability of banking finance.

He said the demand for additional capital that will be delivered the Basel Committee of Banking Supervision, the regulator of global central banks, possibly endangering the economic recovery because it limits the ability of policy drawdown.

"Rules should apply Basel III for a period of 10 years to 12 years, giving time for banks to adjust," wrote the German Banking Association's statement released last night.

Meanwhile, Hans-Joachim Massenberg, Deputy Director of the German Banking Association, separately said the region's banking sector to meet many challenges during the process of economic recovery from the worst recession since World War II.

Institute of International Finance, a group of global negotiations, in June said the proposed regulation is likely to reduce the gross domestic product (GDP) amounted to 3.1% in the United States, Euro area and Japan in 2015.

Basel Committee consists of 27 countries and is responsible for formulating monetary policy for the creditor standards worldwide. Last week, the committee is projecting economic growth to be weaker

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