HSBC group chairman Douglas Flint says hiking core tier one capital ratios to 10 per cent will stunt lending.
Speaking yesterday to MPs in a Treasury Select Committee looking at the Independent Commission on Banking’s proposals, Flint said even a 1 per cent increase in capital requirements will stop banks from lending billions.
He said: “Our capital base is about £140bn globally. So if you stick another 1 per cent, you are taking hundreds of billions of credit capacity out of lending.”
Flint confirmed HSBC had made the point to the ICB.
In a later TSC meeting, Barclays chief executive Bob Diamond warned that capital requirements of 10 per cent are “too high” and would affect lending levels.