EU is urged to drop Basel III's leverage ratio for banks

11/17/2010 | Bloomberg

Leaders from the Group of 20 nations recently adopted a binding leverage ratio, but most EU nations reportedly are opposed to the rule, designed to limit a bank's debt. Sweden, France and other EU members are urging the EU to drop the ratio, saying it might encourage risk-taking. "The leverage ratio as it is currently constructed is a rather blunt instrument," said Rob McIvor, a spokesman for AFME. "It does not take into account different institutions' business models or structures."

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