FOR IMMEDIATE RELEASE
ICBA Praises FDIC Chairman’s Remarks Concerning Basel II
Washington, D.C. (February 26, 2007)—The Independent Community Bankers of America (ICBA) commended Federal Deposit Insurance Corporation Chairman Sheila Bair for her remarks before the Global Association of Risk Professionals concerning the implementation of Basel II capital rules.
"ICBA strongly supports the retention of the leverage ratio and the transitional safeguards for the Basel II banks," said Camden Fine, ICBA president and CEO. "We agree with Chairman Bair that the U.S. banking system would be significantly and adversely impacted if the leverage ratio and the safeguards were removed and the large banks experienced unrestrained double digit reductions in bank capital requirements."
Chairman Bair also said that she was troubled by the tenor of recent discussions about international competition and Basel II and that a race to the bottom in bank capital standards would be a profoundly negative development for the future stability and health of the global financial system.
"The regulators should never consider putting our entire banking system in jeopardy because a few banks claim that they need lower capital requirements to compete internationally," said Fine. "While ICBA believes that the Basel II banks should be able to use the standardized approach to compute their regulatory capital requirements, we do not support the reduction in capital requirements for the Basel II banks or any modification to the leverage ratio or the transitional safeguards."