EU Strength the Banking System

14 May 2012, Brussels

 

The  EU Economic and Monetary Affairs Committee agreed to require banks to improve and strength their defences against future financial shocks. 

 

The tighter rules will be applied to bank capital issues (the funds held by a bank in the form of cash, real estate, bonds, shares, and loans such as mortgages etc. ) and to its liquidity (how easily it can be converted into cash in order to make payouts to creditors and depositors).

 

The proposed rules are being following an international agreement called Basel III and, if the European Parliament approve it, the EU would become the first entity to institute the new requirements.

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