Regulating Banks' State Debt Pile Is a Job for Basel, Hill Says

European Union policy makers should hold off on imposing restrictions on banks’ holdings of sovereign debt until a global consensus is reached on the issue, said Jonathan Hill, the EU’s financial-services commissioner.

“We need to see where Basel is going,” Hill said in an interview in Amsterdam on Friday, referring to the Basel Committee on Banking Supervision. “If you don’t, you’ve got risks of regulatory arbitrage. I think there are risks potentially around financial stability.” As a result, the EU needs to be “sensible and cautious” by approaching reform as part of an international effort, he said.