ASIAN banks will have a tough time meeting new global liquidity rules because of a shortage of assets such as top-rated government debt that can be converted into cash quickly, according to KPMG. !
Lenders that fall short of the liquidity regulations, to be implemented under an international framework by 2015, may be forced to cut lending or compelled to hold more low-yield retail deposits, eroding their profitability. !
Under the framework, known as Basel III, lenders including Hong Kong's Hang Seng Bank Ltd and Singapore's DBS Group Holdings must hold top-quality liquid assets that could meet all their net outflows over 30 days during times of acute market stress. As fiscally disciplined Asian economies have much lower levels of government debt than Western markets, there may not be enough of such assets to go round. Reuters
Tuesday, June 5, 2012
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