THE Bank of England has shied away from placing additional restrictions on banks' balance sheets in favour of waiting for international agreements.
The Bank's Financial Policy Committee, whose job it is to protect the financial system, said it "would return to these issues once an international agreement on the definition of the leverage ratio had been reached".
The leverage ratio requires banks to hold capital in proportion to their assets. In the UK it is currently set at 3% of total non-risk weighted assets but there has been pressure to raise this limit.
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The global Basel committee of banking supervisors is expected to finalise a definition of the leverage ratio in the coming days.
The pressure for change is because British banks are widely believed to have become over-leveraged in the years leading up to the 2008 financial crisis.
Royal Bank of Scotland had a leverage ratio of 31.2 in 2007, meaning that its total assets were worth 31 times its capital. But at HSBC, which weathered the crisis better than most, the ratio was a comparatively conservative 21.3.
The Financial Policy Committee (FPC) said it is doing further work on how banks calculate their capital buffers due to concern that the figures can be massaged.
Minutes to the discussion, which took place on November 20, showed committee members disagreed about whether to force banks to use a standardised approach, which could cost banks £40 million.
But they recorded no disagreement with the key decision at the meeting to refocus the Bank's Funding for Lending scheme towards small businesses.