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The Bank of England has delayed the start of new capital controls for British banks by a year while it waits to see how the incoming Trump administration implements the global Basel accord in the US.
The Bank of England Prudential Regulation Authority's announcement on Friday that it would delay the start of tougher capital regimes in the UK until January 2027 comes as regulators around the world look to see how President Trump will affect financial regulation. , highlighting how nervously they are watching.
The Basel III system was first created more than a decade ago to increase the amount of capital available to banks to absorb stress and avoid a repeat of state bailouts after the 2008 financial crisis.
The PRA had already announced last year that it would amend the so-called Basel 3.1 rules to reduce the additional capital required for UK banks and delay implementation until January 2026.
The Federal Reserve also watered down plans to apply so-called late-Basel rules to U.S. banks after intense lobbying from the sector. Regulations are expected to be further weakened or eliminated under the Trump administration.
PRA said in a statement: “Given the current uncertainty surrounding the timing of implementation of the Basel 3.1 standards in the United States, and with competitiveness and growth considerations in mind, the PRA, in consultation with the Department of the Treasury, has decided to further delay” the implementation of the rules. ”
