Brazil may tap debt market ahead of Basel III rules

Dow Jones Newswire/Fox Business, 02/24/2012

SAO PAULO – Although Brazilian banks are well positioned to implement strict norms imposed by new international rules for liquidity under the Basel III accords, many local banks may tap the international debt market to assure Tier I capital ahead of the January 2013 local kick-off date.

“In general terms, local banks are well prepared and have an adequate framework to operate under Basel III rules, but some players may access capital markets in order to raise Tier I capital to reinforce their positions,” said Luis Santacreu, a banking industry analyst at Sao Paulo’s Austin Rating consulting group.

“The implementation of Basel III rules will be gradual,” he added. “From the banks’ viewpoint, there is no rush.”

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