At the meeting of the Group of 20 nations in the U.S. last month, the U.S. agreed to support new Basel II regulations by 2011, while Europe agreed to adopt a leverage ratio for banks. European banks, however, are resisting the deal, saying the limited leverage ratio would hinder their businesses. "The leverage ratio ... is intrinsically faulty, because it is a blunt ratio," said Pierre de Lauzun, deputy chief executive of the French Banking Federation. "We have nothing against the leverage ratio being part of pillar II of the Basel II framework, as a supplementary indicator, but we are against it becoming a regulatory standard as a part of pillar I."
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