ECB/Centeno: Europe Should Not Follow the US, but Implement Basel III

Forex - European Central Bank (ECB) Governing Council member Mario Centeno stated that any attempt by the U.S. to disregard advanced banking capital rules would lead to negative consequences, and Europe should not take the risk of following that path. The President of the Bank of Portugal, Centeno said, "Europe should implement Basel III as long as it does not create adverse effects. I suspect that the U.S. decision to abandon these rules will backfire. Europe should not be in such a situation."

The new banking capital rules known as Basel endgame or Basel 3.1 will impose stricter capital requirements on banks to protect against future crises. Countries around the world were supposed to implement these rules simultaneously, but various jurisdictions, including the U.S., have since chosen their own timelines and made adjustments to some measures, leading banks to complain about potential disadvantages.