Thicker buffers could be built into the Basel II framework for bank capital.
There also needs to be a framework for bank resolution that safeguards public finances, as we see in other federations.
The final communiqué lacked precision, but for the first time there was something resembling a plausible global framework for bank recapitalisation.
He responds that national charters create a more efficient regulatory framework for banks that would otherwise have to navigate an array of state laws.
They are "essential for restoring confidence in the regulatory framework for banks and to help ensure a safe and stable global banking system," the committee said.
The Spanish government is set on Friday to approve the framework for banks to access rescue financing while allowing them to transfer troubled assets to a "bad bank".
It makes it harder to harmonise global banking regulation, as demonstrated by Basel 2, the new risk-based framework for bank capital adequacy that will take effect in 2007.
ON JUNE 26th, the world's top central bankers put their seal of approval on Basel 2, a new capital-adequacy framework for banks, which is intended to come into force in stages from the end of 2006.
Mr. Draghi also expressed confidence that European leaders would reach agreement soon on a unified regulatory framework for banks, but he insisted that such a system cover all 6,000 banks in the region — a position that is sure to displease Germany, which wants to retain control over the small banks that do most of the lending in that country.
With about a dozen Swiss lenders facing the possibility of indictment in the United States, the Swiss government agreed last month on a framework for banks to hand over information on American clients, a deal it hoped would permanently end the threat of United States prosecution.
