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Reserve Bank of India reschedules implementation of Basel III

The Reserve Bank of India (RBI) has rescheduled the date for implementation of Basel III, an international banking capital regulation, to 1 April 2013 from the earlier deadline of 1 January 2013.

Previously, the RBI agreed with Basel Committee on Banking Supervision to implement the capital regulation from 1 January 2013. The law will be completely implemented in a phased manner by 31 March 2018.

In December 2012, the Basel Committee said that the 11-member jurisdictions including Australia, Canada, China, Hong Kong SAR, India, Japan, Mexico, Saudi Arabia, Singapore, South Africa and Switzerland have published the final set of Basel III regulations effective from the start date of 1 January 2013.

Seven other jurisdictions including the European Union and the US have issued draft regulations, and indicated that they are working towards issuing final versions as quickly as possible.

The recent announcement by RBI will provide banks some time to accumulate required capital, which should not be less than 5.5% of risk-weighted loans, as per the RBI draft guidelines.

RBI plans to closely monitor the progress on Basel III implementation in other nations, particularly the major economies that are members of the Basel Committee.