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* Basel to finalise new rules for top global banks by Nov
* New deadline year earlier than originally planned
* Rules to define global systemically important bank (GSIB
* GSIBs have to hold capital greater than 7 pct minimum
By Huw Jones
LONDON, July 3 (Reuters) - Global banking supervisors arespeeding up work on tougher capital rules for the world's toplenders, in a bid to dispel some of the regulatory uncertaintyover a sector whose reckless behaviour caused the credit crunch.
The Basel Committee, made up of banking supervisors fromnearly 30 countries, said on Wednesday it will finalise its newrules for top global banks by November, a year earlier thanoriginally planned, so lenders have more time to prepare.
The rules being applied are important partly because theywill help define a top section of so-called global systemicallyimportant bank (GSIBs) and how much extra capital they need tohold. Phasing-in of the rules is due to start in 2016, with fullcompliance in 2019.
Leaders of the world's top economies (G20) approved thetougher regime for nearly 30 of the world's biggest banks inNovember 2011, after lenders had to be rescued by taxpayers inthe financial crisis.
The rules require top banks to hold a level of capital evengreater than the 7 percent minimum of their risk-weighted assetswhich all banks globally must hold under the Basel III accord.
Thus banks such as Goldman Sachs, HSBC andDeutsche Bank must hold a further 1 to 2.5 percent ofcapital above the Basel minimum, in recognition of the mayhemthat could result in world markets if they fail.
Yet the eventual impact remains to be seen of the revisedmethodology to determine who is a GSIB - and how much extracapital they must hold.
Revisions to the methodology, issued by the Basel Committeeon Wednesday, consists of indicators looking at a bank's assetsand how interconnected it is with other banks.
MORE PRECISION
Basel has sought to inject more precision in how a bank'sassets are added up to gauge their level of riskiness.
Some top-quality assets that can be sold easily in stormymarkets must now be excluded from calculations to put greaterfocus on the volume of assets "that may suffer a fire salediscount if sold during a period of severe market stress".
Basel is now gathering more data from banks to complete itswork by November so banks can work out whether they are a GSIBand if so, the size of their capital surcharge.
"These elements will enable banks to calculate their scoresand higher loss-absorbency requirements using end-2012 data,prior to the requirements coming into effect based on end-2013data," the Basel Committee said in a statement.
The regulators are due to publish an updated list of GSIBsin September at the next G20 summit in Russia. Some banks on thecurrent list are likely to drop out after shrinking their assetbase, while others may end up being on the list.
Investor and supervisory pressure has already forced the bigbanks to meet or exceed their capital targets, years ahead ofthe formal timetable.
On Tuesday the Federal Reserve approved rules putting theBasel III and GSIB capital regime into U.S. law, mirroring amove already taken by the European Union.
Credit rating agency Standard & Poor's (S&P) said late onTuesday that higher capital requirements and a narrowing of thescope of business activity will leave "fewer or less-attractivebusiness opportunities for regulated and systemically importantbanks".
It cut its ratings on three big banks - Deutsche Bank,Barclays and Credit Suisse - citing thepressure of new rules on income.
G20 regulators are also due to publish shortly a list of theworld's biggest insurance companies who, like the biggest banks,will have to hold extra capital and faces closer scrutiny.
