EU's Barnier says U.S. should respect Basel III

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January 31, 2013 8:35 PM EST

The United States should implement Basel III bank capital rules in the same way as Europe does, at the beginning of 2014, the European Union official in charge of regulation said.

"It is essential that the United States and Brasil and Russia apply the same rules that we decided together. It is a condition for world financial stability, not only for the G20, but for global stability," Michel Barnier, European Commissioner for financial services, told a conference on Thursday.

The comments confirmed that formal introduction of the rules, forcing banks to roughly triple how much capital they hold compared with pre-crisis levels, will be delayed a year in Europe from the January 2013 start the G20 had agreed.

EU states and the European Parliament are haggling over a law that implements Basel III in the 27-country bloc. Barnier said he expected agreement in coming weeks.

In November, U.S. regulators decided to delay formal introduction of Basel III because of "the wide range of views" among U.S. banks, concerned they would not be ready by this month.

So far, about 11 of the G20 economies have introduced Basel III, seen as the world's central regulatory response to the 2007-09 financial crisis that meant taxpayer in several countries had to rescue undercapitalized banks.

The EU is keen to synchronize the introduction of Basel III with the United States after it forged ahead to put its predecessor accord, Basel II, into law years before the United States followed suit.

(Reporting By John O'Donnell and Jan Strupczewski; Editing by Dan Lalor)

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