Global Regulators Back New Bank Rules To Avert Future Meltdowns

Banks must triple the amount of cash they keep on reserve under a new set of guidelines backed by a global group of regulators this Sunday. With a more generous than expected deadline for the rules to take effect, financial stocks perked up on the news.

The recommendations still have to be ratified by the G-20 group in November, and then have to be implemented by individual nations, who fill face pressure from their banking sectors to dilute them to their benefit.

Banks warned than the new rules will restrict their ability to offer credit during a time when consumers need it most, but backers said that any downside is more than offset by the value of having a financial system that won’t as easily implode.

Regulators Back New Bank Rules to Avert Crises [NYT]