Key facts
- France's banking regulator wants permanent changes to the EU's Basel III output floor.
- Supervisors in Finland and the Netherlands oppose the proposed changes.
- Emmanuel Rocher, director of [REDACTED], stated that capital requirements should not continue to increase due to the output floor.
The French banking regulator is pushing for permanent modifications to the European Union's implementation of the Basel III output floor, a regulatory standard that sets a minimum capital requirement for banks based on their risk-weighted assets. This initiative faces resistance from banking supervisors in Finland and the Netherlands, who appear to favor the current framework or a less aggressive approach to capital relief.
Emmanuel Rocher, director of [REDACTED], expressed the French regulator's stance, stating, "We do not consider that we should have this strong trend to continue increasing capital requirements in the future due to the upcoming impact of the output floor." This suggests a belief that the current trajectory of capital requirements is becoming overly burdensome and may not be justified by underlying risks.