WORLD - REGULATIONS - IFSB revising requirements standard for Basel III framework

www.bt.com.bn - THE Islamic Financial Services Board (IFSB) is revising its capital adequacy standard to meet the requirements of the Basel III framework for financial institutions, the secretary-general of the international standard-setting body said here recently.

The revision to the IFSB-2: Capital Adequacy Standard started in January 2011, following the introduction of the Basel III the previous year, which was a response to the 2008-2009 financial crisis that saw governments bail out major banks across the world. (source)

BANKING - REGULATIONS - Basel III in support of the Islamic banking principal

The Group of Governors and Heads of Supervision, the oversight body of the Basel Committee on Banking Supervision, announced a substantial strengthening of existing capital requirements and fully endorsed the agreements it reached on 26 July 2010. These capital reforms, together with the introduction of a global liquidity standard, deliver on the core of the global financial reform agenda and will be presented to the Seoul G20 Leaders summit in November.

The Committee's package of reforms will increase the minimum common equity requirement from 2% to 4.5%. In addition, banks will be required to hold a capital conservation buffer of 2.5% to withstand future periods of stress bringing the total common equity requirements to 7%. This reinforces the stronger definition of capital agreed by Governors and Heads of Supervision in July and the higher capital requirements for trading, derivative, and securitization activities to be introduced at the end of 2011.

BANKING - BASEL III - Islamic body IFSB to revamp capital rules

KUALA LUMPUR - REUTERS - The Islamic Financial Services Board, an association of regulators in Muslim countries, will revise its rules next year to enhance sharia banks' capital in line with Basel III reforms, its secretary-general said.

Rifaat Ahmed Abdel Karim said IFSB would seek its council's approval in December to begin work next year on amending the regulations, with the process expected to be completed around 2013.