Banks Climb on Eased Deadlines, But Capital Requirements Double

Regulators gave banks more time to comply with new regulations than analysts had expected. Banks now have 8 years to comply with the new rules set by the Basel Committee on Banking Supervision.

The new regulations call for a total common equity of 7% for banks, which includes a minimum common equity level of 4.5% (increased from the previous 2%) and a capital conservation buffer of 2.5%. The new requirements expect to create a more resilient banking system which will allow real lending to the economy and will enable banks to raise dividends. 

Despite the relaxed deadlines and regulators beliefs, some bankers think that a 7% requirement is too high and will curb lending. I wonder if this will actually weaken the economy.