The Bank of England’s plans to tighten capital adequacy rules for banks in the UK are “very detrimental” to the economy, NatWest’s chief financial officer said, while financial institutions around the world are opposing tighter regulation from regulators.
Speaking at an investor event, NatWest chief financial officer Katie Murray said the UK’s plan to introduce stricter international capital standards, known in the US as the ‘Basel endgame’, was too strict.
“We have major concerns, particularly around lending to SMEs, infrastructure and green loans.
NatWest has made its views known to both the BOE’s prudential regulator and the UK Treasury, Murray said.
The Bank of England is currently in consultations on the latest version of the international standards adopted by the Basel Committee on Banking Supervision after the 2007-2009 financial crisis.
The resistance to the latest rules in the US is notable. US banking groups have accused regulators of violating federal law and JP Morgan CEO Jamie Dimon said last week that the proposals were “very disappointing”.
The BoE said the implementation of the remaining rules of the global standard Basel III, due to come into force in January 2025, would result in banks increasing their capital requirements by around 6% by the end of the decade.
