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UPDATE 1-Regulators say four big banks must hold more capital

Thursday, 1 Nov 2012 | 8:58 PM ET

Nov 1 (Reuters) - Global regulators on Thursday said Citigroup Inc, Deutsche Bank, HSBC and JPMorgan Chase & Co will need to hold the most extra capital of 28 banks considered so large and complex they need an extra buffer to absorb potential losses.

The four global banks will be required to hold an extra 2.5 percent of common equity as a percentage of risk-weighted assets on top of the Basel III 7 percent minimum being phased in from January. The additional cushion aims to make sure large banks won't threaten the financial system in future crises and require government bailouts.

Barclays Plc and BNP Paribas were assigned the next highest buffer of 2 percent, according to the Financial Stability Board, a regulatory task force for the group of 20 top economies. Eight banks including Bank of America Corp and Goldman Sachs Group Inc fell in the next highest bucket of 1.5 percent.

Thursday's statement was timed for a meeting of G20 finance ministers in Mexico this weekend when governments will review progress in implementing a welter of pledges to reform finance after the 2007-09 crisis.

Large banks have been building capital toward meeting the Basel III requirements and waiting to learn what additional buffer would be required on top of that.

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