Bankers look to simplify rules

The Basel Committee on Banking Supervision is attempting to develop multiple layers of regulation for different countries and different banks, said Stefan Ingves, chairman of the committee and governor of Sweden's central bank, on Thursday.

Based at the Bank for International Settlements in Basel, Switzerland, the committee is working on one set of rules with complex models that internationally active banks are using.

It is also working on revising standardized rules, which are simpler because they do not use such complicated models. Those should be put together in such a way that they can be used easily by smaller banks, Ingves said after the 18th International Conference of Banking Supervisors.

"We have a consensus that we need elements of proportionality in the sets of rules that we produce because some banks are very large and global, and we need rules for them. At the same time, we need rules for small banks in the rural parts of any country," he said.

Banking supervisors and central bankers representing more than 100 jurisdictions met in Tianjin this week at the conference hosted by the China Banking Regulatory Commission to discuss a range of policy measures relating to the Basel Committee’s post-crisis reform agenda.

Participants also discussed the role of banking systems in promoting growth and making financial services safe so that they could support the real economy.

In recent years, international financial regulations have become increasingly complex as the banking system becomes ever more complicated and vulnerable to financial risks. Many bankers complain that the rules have become onerous and have driven up compliance costs for banks.

"We need to think hard about simplicity, comparability and risk sensitivity because some of these rules are very complex. They tend to get more complex over the years and eventually you get to a point when you need to ask yourself, ‘Did they get too complex?’ Then you move into the other direction. That takes a while," said Ingves.

Members of the Basel Committee agree that it is important to be able to compare what different countries do and to what extent they do what they has been promised in different parts of the world.

PBOC official sees bright side of shadow banks	Global payments in yuan triple in value since 2012