China sets 2010 date for Basel II

Chinese banking regulators have announced that the new Basel Accord, Basel II, will be implemented for selected banks in 2010.

The China Bank Regulatory Commission (CBRC) said that Basel II will be carried out by some Chinese banks with a large number of overseas branches between 2010 and 2012.

Liu Mingkang, head of the China Banking Regulatory Commission, said that Basel II implementation was important, but would take time.

"International experience shows that improvement in banks' internal mechanism is vital for improving their vitality, but it's still an arduous and long task," he said.

The move marks a change in tone from the Chinese authorities, who have criticized the new Basel Accord for its unsuitability to the banking industries of emerging economies.

The CBRC had previously stated that the more rigorous Basel II would not be implemented until the entire Chinese banking sector was ready.

The rules, which intend to strengthen banks' risk resistance, tell banks how much capital should be kept to protect themselves against incidents such as the bankruptcy of a large corporate borrower.

They are due to be implemented globally between 2008 and 2011.

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