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US not ready for Basel III bank rules—Treasury

US Treasury Secretary Tim Geithner AFP PHOTO/JEWEL SAMAD

WASHINGTON—The US Treasury announced Friday that it would not implement the Basel III rules for strengthening banks on January 1, saying the banks were not yet ready to meet the tougher capital standards.

“Many industry participants have expressed concern that they may be subject to a final regulatory capital rule on January 1, 2013, without sufficient time to understand the rule or to make necessary systems changes,” the Treasury said.

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Tags: Banking , Basel III , economy , Finance , regulate , US

  • manongcastro

    Philippine banks are compliant to Basel III standards is because they are super conservative. They’ll let businessmen and entrepreneurs bleed first before they lend money. And when money is lent, exorbitant fees and interests are charged. 

    In the Philippines, macro and micro enterprises have difficulty getting funding and resorts to loan sharks. Banks are unfriendly to them. And this is one of the reason why local small businesses don’t flourish. They remain small.  Even some of the mid sized companies don’t become larger because of limited funding.   

    I’m not saying that banks suddenly disregard their risk controls but rather working with small businesses on raising capitals. There are a lot of honest and hardworking Filipino businessmen that I know and it breaks my heart when I hear them tell their story on how they have a hard time dealing with the bank.

    The Philippines is the 12th most populous country in the world, 23 being the median age – very young demographics, we’ve had strong gdp growth in the past year at 6% which is next only to China. In summary, there is a big potential market here. 

    The Chinese have long understood this and Chinese immigrants have become rich (billionaires). Since majority of the Filipino-Chinese control the banks, they have easy access to low interest rate funding. The Koreans have also recognized this opportunity and now come in droves. Europeans and American fund managers understands this and this is the reason why hot money inflows in the Philippines have skyrocketed recently.

    Now, who is left out? The Filipinos! Everybody else appears to be getting rich except the average Filipino.

    This is a call to the banks – lend money to the Filipino businessmen and entrepreneurs so that their businesses would grow!

    • http://jaoromero.com/ Jao Romero

      you should thank the conservative streak of the banks here. otherwise, our country will be mired in the same sh1t the western countries are experiencing. that’s why our economy remains resilient in the face of this global disaster. we aren’t as exposed to these toxic debts as other countries are.

      you know even less about your call to have banks loosen lending rules. that will spur on inflation. in other parts of the world, they are tightening bank regulations and lending rules because of the disaster loose bank control has brought to the world, and here you are arguing for the opposite.

      how stupid can you get, really?

      i am infuriated by stupid ppl like you. you make the world worse by spreading your ignorance.

      • manongcastro

        Wow! You are the kind of person who blast and insult other people for expressing their own opinions.

        And infuriated I might add? You need to control your emotions buddy as you’ll die young due to high blood or from your enemies you insult and obviously belittle. LOL… 

        Aristotle said that “It is the mark of an educated mind to be able to entertain a thought without accepting it.” and may I add – without insulting it.You should see the two sides of a coin. Ultra conservative is bad as well. Anyway, I don’t have time to argue with small and closed minds. Ta..

      • malvar pagasa

        forgive him manongcastro, jao does not know anything about Philippine banking. Our banks would only lend what it borrowed from the govt to the govt dummies to control risk, i.e. premium rates from bangko central and deposits, then lend to government corporations.. easy money and zero risk! :)

  • pilipino

    What US banks are not compliant to the Basel III standards? Do they have operations in the PHL? In that case, they should not be allowed to operate here not until they comply because it will be unfair to its clients and to our local banks which are becoming compliant. At least Citibank is already compliant.

    Our local banks who can’t comply with this higher capital adequacy and lower NPL ratio requirements are selling off or merging with bigger banks. One example is the owners of Premiere Bank sold it to Security Bank which ratios are are far better than Basel III standards. BPI and BDO have better ratios also.

    In business we used to say that when the US sneezes, the PHL catches a cold. But not anymore. What is becoming more evident is the PHL economy is adjusting to become a bit resilient, and their weakening economy has become a boom to us, except for our electronics and export industries that are focused on the US market.

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