November 7, 2018 / 9:27 PM / 8 months ago

Australia's banking regulator proposes hiking capital requirements

SYDNEY, Nov 8 (Reuters) - Australia’s banking regulator said on Thursday it wanted to lift banks’ capital requirements in order to strengthen the financial system’s ability to cope with shocks.

The Australian Prudential Regulation Authority (APRA)proposed lifting total capital requirements for the country’s four biggest lenders by four to five percentage points by 2023, in a discussion paper it released on its website.

APRA said banks could use any form of capital to meet the higher requirements and that it anticipated most of it would be tier 2 capital. “The proposed changes are expected to marginally increase each major bank’s cost of funding,” APRA said.

It is seeking industry feedback before the proposals are implemented. (Reporting by Tom Westbrook; editing by Andrew Roche)

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