When the new Basel III global bank regulations are imposed, the top 35 U.S. banks will be short between $100 billion and $150 billion in equity capital, a study by Barclays Capital finds, the Financial Times reports. Moreover, 90% of the shortfall is concentrated in the biggest six banks.

The Basel III reforms aim to increase the resilience of the global banking system to avoid another financial crisis. The reforms introduce a set of capital buffers, as well as more stringent capital and liquidity requirements. While European banks have been following Basel II for years, American banks have yet to apply those changes, and now they'll also have to implement Basel III requirements.

Basel III requires a 7% minimum tier one capital ratio, a key measure of bank strength. The BarCap study assumes that banks will need to hold top-quality capital equal to 8% of their total assets, providing a one-point cushion.

To achieve the requirements, banks can either reduce their riskier assets (by selling some, for example) or increase capital (by issuing equity, for example). While most analysts don't believe the big U.S. banks will be forced to raise capital just for regulatory purposes, some worry that sharp cuts in assets could force banks to curb lending or raise borrowing costs, the FT adds. This could have ramifications for the economy.

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Jolly JolyMoore

"...increase capital (by issuing equity, for example). While most analysts don't believe the big U.S. banks will be forced to raise capital..." See full article from DailyFinance: http://srph.it/91fdJh Yes--- Don't force the taxpayer, but empower the small investor. I would like to have a slice of a couple of those banks in my portfolio.

November 23 2010 at 6:29 AM Report abuse rate up rate down Reply
rvhwood1

When are the Basel 111 globel regulations going to go into effect? While I agree with that type of regulation I would say no more government bail out monies for US banks. It appears that far and wide during the last bailout the banks had the best of it and the taxpayers took the burden of their ineptitude.

November 22 2010 at 5:29 PM Report abuse rate up rate down Reply
edtecpubs

Supposedly, Warren Buffett wants to pay more taxes. This is not quite true. What he wants is for OTHERS to pay more taxes. His earned salary is said to be only about $100,000 per year. The bulk of his income comes from capital gains, subject to a tax of only 15%. And the bulk of his fortune is going into Trust Funds, meaning that he will avoid all estate taxes, even though he says estate taxes are a great thing -- for everyone else!

November 22 2010 at 3:22 PM Report abuse +2 rate up rate down Reply
1 reply to edtecpubs's comment
wfreeberg

Yes,his salary is low and his taxes are low, capital gains, because he donates the majority of his money to charities. In the last year or so he donated billions to the Gates Foundation. His donations provide him a tax credit. He still lives in the same house, 20+ years and drives an older car. Quite a man.

November 22 2010 at 6:16 PM Report abuse rate up rate down Reply
cselles

Reminds me of the song by David Gray. I'm young but already There's doubt in my eyes And I never learned how to pray So make me feel better Tell me more lies Carry me further away

November 22 2010 at 1:21 PM Report abuse +1 rate up rate down Reply
bill griffis

GIVE US A BREAK! another sad story about banks they cause this damm mess

November 22 2010 at 1:15 PM Report abuse +2 rate up rate down Reply
johnskii

How about all bonuses be abolished in bank/financial firms who received TARP funds be for the next two years to make up for shortfalls within the system.....

November 22 2010 at 12:21 PM Report abuse +3 rate up rate down Reply
gagesxm

IF BANKS HAD TO MARK THEIR COMMERCIAL REAL ESTATE ASSETS TO MARKET (INSTEAD OF BEING ALLOWED TO HOLD AT HISTORICAL VALUES) THEN NONE WOULD BE ABLE TO MEET CAPITAL REQUIREMENTS...COUPLE THIS WITH THE 37 TRILLION (2008 NUMBER THAT HAS GOTTEN WORSE) IN TOXIC ASSETS THAT HAVE BEEN SWEPT UNDER THE RUG BY ALLOWING THE INSTITUTIONS TO VALUE AT WHATEVER THEY FEEL APPROPRIATE (WHICH MEANS NO TWO INSTITUTIONS WILL HAVE THE SAME VALUE ON A PARTICULAR TOXIC ASSET...IE TOXIC ASSET XYZ...YOU VALUE AT 60 AND I CAN VALUE AT 100...WHEN ACTUALLY THE TRUE MARK TO MARKET VALUE MAY BE 25)...MOST BANKS (AND AIG FOR SURE) ARE BANKRUPT...ITS ALL A HOUSE OF CARDS AND THE WIND IS BLOWING...WILL BE A SAD TIME IN GLOBAL HISTORY

November 22 2010 at 11:31 AM Report abuse +6 rate up rate down Reply
2 replies to gagesxm's comment
donut999

amen, amen, amen. why don't people realize this? where do people think all this bad paper went? there would be 1000's of banks down if the fed and fdic were playing by the real rules.

November 22 2010 at 12:02 PM Report abuse +2 rate up rate down Reply
donut999

the other part of this besides commercial is just residential real estate. the banks would actually prefer for foreclosures to be in limbo. once done, the homes are on their books. the can pretend the homes are worth what the defaulted mortgage owed is, but, get real. there are millions of bank/financial institution held homes not even on the market. what is called the phantom inventory. they occassionally let a short sale happen if the spread is something they can live with absorbing on balance sheet, but most are not. if $100k owned, they might might turn it loose at $85k and eat the the $15k. unfortunately, most are probably more like 30-60% more owed than what the house will sell for. and, it is getting worse everyday.

November 22 2010 at 12:11 PM Report abuse +1 rate up rate down Reply
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November 22 2010 at 11:26 AM Report abuse -1 rate up rate down Reply
galaxy4262a

i hope and p[ray evrey day thease big ripoff banks go under befor the year ends like b o a,,,, and c and others if people would only stop useing them no more then nesasary and take out most of their money from their accounts just leave enogh to keep your account open so it cost them to do the paper work and if they charge for cheking , close it out and go to a bank that provides free cheking i use wachovia its free and i save a lot ,, make them banks pay for throwing people out on the streats and for rasing their fees way to much . they got bailed out its time we close their doors and start thinking about the people that payed the tax money that saved them

November 22 2010 at 10:50 AM Report abuse +1 rate up rate down Reply
rcumor

Well, maybe it is because they didn't give a big enough BONUS to the top executives...

November 22 2010 at 10:27 AM Report abuse +1 rate up rate down Reply