If ratified by the G-20 nations later this year, the rules, known as Basel III, will require banks to bolster the amount of low-risk assets they hold in reserve as a cushion against market shocks. While the American Bankers Association and other groups have complained about the provisions, other bankers said the rules will help avert crises of the kind that nearly plunged the world into depression in late 2008.
“Banks will unarguably be safer institutions,” said Anders Kvist, head of treasury at SEB, a bank based in Stockholm that has operations around Europe.
Analysts had expected the Basel group to sharply raise the most bulletproof category of reserves, known as core Tier 1 capital, to about 8 percent of bank assets from as little as 2 percent under current rules.
In addition, regulators were expected to oblige banks to raise their reserves even more during boom times, as insurance against a sudden market collapse. Banks would have to add an additional 3 percent of assets to their reserves, to a total of about 11 percent.
Some analysts predicted that banks might even be required to set aside as much as 16 percent in boom times.
The regulators were also expected to impose a so-called leverage ratio, a new requirement which would oblige banks to maintain reserves of at least 3 percent of total assets, including derivatives or other instruments that they might not carry on their balance sheets.
The leverage ratio is an attempt to force banks to hold reserves against all their money at risk, with no leeway to game accounting rules.
The rules, which also require adoption by individual nations, will be phased in gradually to give banks plenty of time to adjust. Some banks may face market pressure to stock up on capital sooner, but the impact may be less than feared because many banks have already increased their reserves in anticipation of the new rules or are planning to do so.
Deutsche Bank in Frankfurt said Sunday that it would sell shares worth 9.8 billion euros ($12.5 billion) beginning at the end of this month, primarily to finance the acquisition of Postbank, a German retail bank, but also to bolster its reserves.
Analysts say that most United States institutions already comply with the new rules, but that some European banks will need to raise more money either by holding on to profits that they may have otherwise distributed to shareholders, or by selling new stock.
Among the institutions that might need to raise more money are Société Générale in France and Lloyds in Britain as well as Deutsche Bank, according to calculations by Morgan Stanley made before the new rules were announced. Other banks whose current capital reserves might not be sufficient under the new rules are Royal Bank of Scotland and Barclays in Britain, and Crédit Agricole in France, according to Nomura Equity Research.
Banks that have already increased their capital, such as SEB or UBS in Switzerland, will be in a better position and may be able to pay out profits to shareholders that they had been husbanding while policymakers debated the new regulations.