The China Banking Regulatory Commission (CBRC) plans to increase capital adequacy ratio (CAR) requirements for banks under new rules likely to be released next year, Reuters reported, citing state media. A report in China Business News quoted an unidentified source as saying the CBRC would require large banks to increase their CAR to 11%, while smaller banks would have a minimum requirement of 10%. At present, China’s banks are required to have a CAR of no less than 8%. The new rules would permit regulators to increase a bank’s CAR by an additional 5 percentage points, and would set leverage ratios to require that banks’ core capital is at least 4% of total assets. No specific date was given for the introduction of the new rules.
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