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Schaeuble dismisses lighter Basel III reports

Tuesday 24 January 2012 – by [email protected]

German finance minister Wolfgang Schaeuble has rejected claims that France and Germany are looking to water down the international Basel III agreement.

Speaking in Paris with French counterpart François Baroin, Schaeuble denied a report published in the FT claiming that the officials are seeking to water down capital requirements for banks with insurance holdings and lengthen the period until they have to expose their leverage ratios.

“We both say the same thing: no, that is wrong,” Schaeuble told a press conference on Monday.

“What we are doing is trying to implement Basel III.”

The article had claimed that the pair were set to put forward proposals on Tuesday to ensure that lending to the real economy would not be curtailed by the heightened capital requirements of Basel III.

Though it did not provide specific details, the report said that the proposals would allow banks to hold less capital against specific loans. It claimed that a three-year delay until 2018 would be put in place requiring banks to publish their leverage ratios, which measure the balance between high-quality capital to overall assets.

The paper claimed that the draft measures said: “European institutions should agree on achieving the EU financial market regulation agenda while taking due consideration of its impact on the financing of the real economy.”

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