UPDATE 1-Basel trading book rules delayed by year

* Co-ordinated start date of not later than Dec. 31, 2011

* United States was not ready to apply rules

(Adds more details, background, reaction)

FRANKFURT, June 18 (BestGrowthStock) – The Basel Committee of
central bankers and supervisors agreed to delay its tough new
capital requirements on bank trading books by one year, it said
on Friday.

“The Committee agreed to a coordinated start-date of not
later than Dec. 31, 2011 for all elements of the July 2009
trading book package,” it said in a statement.

“As a result of these revisions, market risk capital
requirements will increase by an estimated average of three to
four times for large internationally active banks.”

Capital requirements for a bank’s trading book are lower
than for the main book, which has encouraged banks to shift some
assets to the trading book to escape higher capital charges.

The delay comes after banks argued they need more time
because the United States was not ready to apply the rules
earlier, and the European Union and the U.S. said the
implementation should be done jointly in both regions.

The Association for Financial Markets in Europe, a banking
lobby that represents some of the world’s biggest banks, said in
April the end of 2010 start date for the rules was unrealistic
and that the United States did not appear ready.

“It’s a welcome move and it’s a sign the committee has been
listening very carefully to what people have said and we are
pleased with that,” an AFME spokesman said on Friday.

Deutsche Bank (DBKGn.DE: ) Chief Executive Josef Ackermann
urged regulators last week to coordinate the tougher trading
book rules.

“We believe the implementation of Basel 3 trading book
proposals should be simultaneous, symmetrical, and comparable
across all major financial markets,” Ackermann said.

Banks also expect the Basel Committee to be more flexible in
implementing its wider Basel III reform of bank capital and
liquidity requirements.

The Group of 20 leading countries agreed last year this
should be implemented by the end of 2012 but G20 finance
ministers said this month there is likely to be a long phase in
for some Basel III elements.

Stock Market Advice

(Reporting by Huw Jones and Sakari Suoninen; Editing by Ron
Askew)

UPDATE 1-Basel trading book rules delayed by year