Bloomberg View: Basel III's Bedeviling Complexity

More than four years after a financial breakdown plunged the world economy into the worst slump since the Great Depression, efforts to build a stronger global system of bank regulation are barely inching forward. Regulators seem overwhelmed by the complexity of their own reforms. To make faster progress toward a safer system, governments must aim for greater simplicity.

The Federal Reserve and other regulators have said U.S. financial institutions won’t be held to a Jan. 1 deadline to boost their capital as required by the Basel III international banking standards. At the end of October, the chairman of the Financial Stability Board—the multinational panel overseeing the Basel III reforms—said he expected that only 6 of the 28 global banks identified by the board as “systemically important” would be covered by the new rules on the agreed start date.