The European Union may miss a January 2013 deadline to implement tougher capital and bonus rules, the U.K. Financial Services Authority said on its website today.
Discussions among lawmakers and finance ministers from the 27-member bloc have taken longer than originally scheduled, making it “clear the legislation will not be adopted earlier than autumn 2012,” the U.K. financial watchdog said in a statement. Translation, verification and signing of the text make it “unfeasible” that the rules will take effect on time.
Governments face a January 2013 deadline set by the Basel Committee for Banking Supervision to implement the draft law, which would more than triple the core capital that lenders must have to 7 percent of their risk-weighted assets. The Group of 20 nations said banks should boost their reserves to prevent any repeat of the wave of taxpayer bailouts that followed the 2008 collapse of Lehman Brothers Holdings Inc.
“In light of these developments the FSA will keep the situation under active review and continue to support the European institutions in their efforts to reach a conclusion on the final version of the legislation,” the watchdog said in the statement.
EU lawmakers have sought to limit bankers’ bonuses to no more than their annual salary as part of their implementation of the rules.