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A draft of the paper seen by the Financial Times calls for special treatment for banks that own insurance companies, and for a three-year delay to the mandatory deadline to disclose leverage ratios, a measure of bank borrowing and risk.
The demands will delight some bankers but are likely to infuriate policymakers in London, who have been fighting hard to stop French-led attempts to dilute the Basel III accord.
According to the draft proposal, Mr Baroin and Mr Schäuble warn that a rush to implement the rules could crimp lending capacity and severely affect the real economy. “European institutions should agree on achieving the EU financial market regulation agenda while taking due consideration of its impact on the financing of the real economy”, the draft proposal states.
The draft Franco-German statement supports tweaking the rules to help banks support small and medium-sized businesses by allowing them to set aside less capital against specific loans.
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