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The
European Parliament's economic affairs committee approved a
draft law to implement Basel III capital rules from January
2025, though backing several temporary divergences to give banks
more time to adapt.
The United States, Britain and other countries are taking
similar steps, but the committee used the draft law to introduce
new elements, including requiring banks to hold enough capital
to cover holdings of cryptoassets in full.
"Banks will be required to hold a euro of their own capital for
every euro they hold in crypto," said Markus Ferber, a
centre-right German member of the committee.
The move, an interim measure pending further EU legislation, is
in line with recommendations from global banking regulators.
"Such prohibitive capital requirements will help prevent
instability in the crypto world from spilling over into the
financial system," Ferber said.
The Association for Financial Markets in Europe (AFME), an
industry body, said the draft law contains no definition of
crypto assets and could end up being applied to tokenised
securities as well.
EU states have already approved their version of the draft law,
and lawmakers will now negotiate a final text with member
states, with further tweaks expected.
Foreign banks operating through branches in the EU will be
watching the talks closely.
EU states have taken a more accommodative approach to when
foreign banks serving customers in the bloc should open a
branch, or convert a branch into a more heavily capitalised
subsidiary, with EU lawmakers on Tuesday taking a harder line.
The EU is keen to build up "strategic autonomy" in capital
markets as it faces a competing financial centre on its doorstep
after Brexit.
AFME said it will be important to avoid "significant adverse
impact" of tightening EU access to international markets and
cross-border services.
(Reporting by Huw Jones; Editing by Jan Harvey)
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