The Basel Committee on Banking Supervision met today in Seoul, South Korea to work towards finalizing its reform program.

The Committee stated that, in addition to the enhanced capital requirements approved in September, it has agreed on key details related to the liquidity coverage ratio (LCR) and confirmed that both the LCR and the net stable funding ratio will be subject to an observation period and will include a review clause to address possible unintended consequences. The Committee also reviewed public comments it received in response to its Proposal to ensure the loss absorbency of regulatory capital at the point of non-viability (August 2010) and agreed to finalize this proposal by the end of the year. Finally, the Committee agreed to release its report Calibrating regulatory minimum capital requirements and capital buffers: a top-down approach. By the end of the year the Committee will also issue detailed rules setting out all elements of the standards for both the capital and liquidity requirements.

At the conclusion of its meeting, the Committee published a report on its comprehensive regulatory reform program to address lessons learned from the financial crisis. The report was prepared for the G20 Finance Ministers and Central Bank Governors who will meet in Gyeongju, South Korea on October 22-23. The report describes measures taken by the Committee and its governing body of Central Bank Governors and Heads of Supervision to strengthen the resilience of banks and the global banking system.