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EU Banks Face Basel Rule Overhaul That Goes Beyond Bonus Curbs

European Union banks will be forced to boost capital, disclose more information on their activities than ever before, and face tougher scrutiny of how they measure risks, after lawmakers formally endorsed a law to overhaul the bloc’s financial rulebook.

The European Parliament backed the sweeping changes, which also include a cap on banker bonuses at twice fixed pay, at a meeting in Strasbourg, France. The EU’s biggest banks had a combined 112.4 billion-euro ($147.3 billion) shortfall as of June 2012 in the reserves needed to meet the tougher capital standards, according to European Banking Authority data.