Britain plans to apply Basel bank capital rules in full

By Huw Jones

LONDON, March 11 (Reuters) - Britain said on Wednesday it
plans to fully implement globally-agreed bank capital rules that
were a response to the financial crisis a decade ago.

Tougher Basel capital rules were devised by global financial
regulators to prevent a repeat of the 2008 crisis when taxpayers
had to bail out undercapitalised banks.

Much of the package has been implemented but some remaining
elements will come into force over the next few years and
European banks have been lobbying to water some of them down.

Britain's finance ministry said it intends to implement
recent revisions to the Basel capital rules to demonstrate "the
government's ongoing commitment to implementing leading global
standards in financial services".

Bank of England Deputy Governor Sam Woods has singled out
European banks for wanting to set off investment in software
against capital requirements, a step he does not want Britain to
take.

The ministry said it wants a "flexible approach" to
rulemaking that ensures continued "proportionality" for
non-systemic investment firms and supports UK competitiveness in
global financial services.

The ministry said there would be public consultations on
implementing the remaining Basel rules.

RULES "GRID"

The ministry said a regulatory initiatives "grid" would be
launched over the summer to give a two-year heads-up on what new
rules are coming up.

This is in response to the financial sector saying it is
often faced with a plethora of new rules at same time from
different regulators, making it hard to comply in a timely way.

"The grid will be published twice a year and will set out an
indicative timetable for each regulatory initiative," the
ministry said.

It will include all of Britain's main financial regulators
along with the Competition and Markets Authority, with a
ministry official as an observer.

Stephen Jones, CEO of UK Finance, said the announcement of
the grid was a positive step and showed the government had taken
on board the finance industry's concerns.

“Good coordination between regulators helps to ensure the
flow of regulatory activity is manageable for firms and avoids
unintended interactions and unnecessary costs," he said.

“We look forward to working closely with the Treasury and
regulators on the detail of these measures.”

(Reporting by Huw Jones. Editing by Jane Merriman)