A group of central bankers and regulators from around the world agreed on the new capital requirements for banks, however the industry will have to wait until after a further meeting at the weekend to hear the final proposals.
On Sunday, the Group of Governors and Heads of Supervision, the oversight body for the Basel Committee, will meet to give their assent to the rules, which means markets will have to wait until Monday to give their verdict on the new capital requirements for banks. This prospect of more uncertainty, with speculation growing that the new capital ratios required will be higher than originally expected, made for a volatile day of trading, with the STOXX indices of European bank shares falling 1.5pc, while gold prices rose on fears over the health of the region's banking system. Current expectations are for a doubling in core Tier 1 capital ratios from 2% to 4%, while the minimum Tier 1 capital requirement could also double to 8%.