September 8, 2010 / 7:46 PM / 9 years ago

UPDATE 1-France to follow U.S. lead on Basel III - Lagarde

* Lagarde says Basel III must apply equally to all

* Says France will not follow rules unless U.S. does so

* Details of Basel III rules expected on Sunday (Adds background, context, details)

PARIS, Sept 8 (Reuters) - France will not follow Basel III standards on capital requirements for banks unless the United States does so, the country’s economy minister said in a newspaper interview on Wednesday.

Bankers and investors are eagerly awaiting details of the new standards, which will determine how much more of a capital cushion banks have to set aside as a safety net in the event of another financial crisis.

The Basel Committee of central bank and regulatory officials agreed a proposal for the new rules on Tuesday but plans to keep the details secret until Sunday. For details, see [ID:nLDE6861DD].

“It is necessary for these rules to apply to everyone,” Christine Lagarde told La Tribune newspaper in an interview to be published on Thursday.

“We will not apply the new standards of Basel III if the Americans don’t do it,” she added.

The head of Germany’s Bundesbank Axel Weber said earlier on Wednesday that Basel III talks could be wrapped up over the weekend, while insisting that no country should stand in the way of a deal being reached.

Lagarde said it was vital that the Basel Committee not impose “excessive rules” on capital requirements for banks because the French economy was largely dependent on the ability of its banks to lend freely.

The Basel Committee has said the reforms will have a minimal impact on economic growth over time and reap benefits in making the financial system more secure, although banks dispute this scenario, saying it could jeopardise recovery. (Reporting by Nick Vinocur; Editing by James Dalgleish)

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