May 27, 2010 / 6:09 PM / 9 years ago

G20 must coordinate financial reforms - U.S. Treasury

BALTIMORE (Reuters) - A top priority for the Group of 20 major economies is making sure global financial regulations, including limits on bank leverage, are “well harmonized,” Deputy U.S. Treasury Secretary Neal Wolin said on Thursday, adding that he saw progress in this area.

“I think there is a good deal of convergence globally on the basic objectives and ways to achieve these objectives,” Wolin told a broker-dealer regulatory conference here.

He said that the United States has been advocating substantially higher capital standards worldwide, and much work is being done on that point at the G20 level.

“Leverage is something that absolutely needs to be addressed by the regulators. It needs to be done here in the United States but also in the context of an international framework,” Wolin said at the Financial Industry Regulatory Authority conference.

Some countries have shown reluctance to adopt specific leverage caps and a key test will be whether a new package of Basel III reforms will be adopted at a G20 summit in November. Banks are lobbying hard to delay introduction of the new regulations.

The G20 finance ministers and central bank governors are expected to take up discussions on bank capital and other financial reforms at a meeting in Busan, South Korea, on June 4-5.

As the G20 and the Basel Committee on Banking Supervision work through these issues, Wolin added: “We want to make sure we get this right at the core — to make sure there are thicker cushions, more capital, higher quality capital, but also attention paid to defining leverage ratios that would also be an important piece of the regime.”

Reporting by Joseph Giannone, writing by David Lawder; Editing by Padraic Cassidy

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