Bank supervisors intervene in global accounting deadlock
LONDON (Reuters) - A top banking supervisor has listed minimum requirements it wants to be used by banks making provisions for bad debt, in a letter to accounting industry rule-setters struggling to agree new global standards.
World leaders called in April 2009 for a single set of global accounting rules to improve transparency and force banks to make provisions early enough so as not to have to be bailed out by taxpayers in a financial crisis.
The International Accounting Standards Board, whose rules are used in over 100 countries, and U.S. Financial Accounting Standards Board have been trying to forge those new rules but have failed to find common ground on bad debt provisions.
"We are concerned ... the boards may not reach convergence given the FASB's recent decision to pursue an impairment model that differs from the IASB's model," the Basel Committee on Banking Supervision said in the letter, dated December 21 and made public on Friday.
The comment marked an escalation of pressure on the two accounting boards who have repeatedly failed to meet deadlines set by the group of 20 leading economies (G20) for common rules.
The Basel Committee also said that what the boards do agree may not pass muster.
"While the boards have made significant progress in developing expected loss models, we also remain concerned as to whether the eventual standards will result in the early and timely build-up of sufficient levels of credit allowances."
(Reporting by Huw Jones; Editing by Dan Lalor)
- U.S. war veteran released by North Korea returns home |
- Pennsylvania newlyweds "just wanted to murder someone together:" police
- U.S. ice storm causes blackouts, delays in Texas, Arkansas
- WTO overcomes last minute hitch to reach its first global trade deal
- China's parliament: Japan has "no right to criticize" air defense zone
Nelson Mandela: 1918 - 2013
Reuters looks at the life and times of Nelson Mandela, an icon of peace and reconciliation who came to embody the struggle for justice around the world. Video