From the Regulators

New rules will incorporate Basel Committee’s leverage ratio requirements

By James Langton |

Federal banking regulators issued new draft guidelines on Wednesday that will introduce new leverage requirements for banks next year.

The draft rules, published by the Office of the Superintendent of Financial Institutions (OSFI), will incorporate leverage requirements issued by the Basel Committee on Banking Supervision into OSFI guidance. The new leverage ratio requirements are being adopted as part of efforts to overhaul the capital adequacy rules in the wake of the financial crisis.

Banks must start making public disclosure of their leverage ratios in 2015, so OSFI has decided to adopt the Basel leverage ratio beginning in the first quarter of 2015; so that banks don't have to calculate both the Basel metric and the measure of leverage used by OSFI in the past.

OSFI's new guideline is out for comment until September 12.