EU banks must drop €3.2T in assets for Basel III

|By:, SA News Editor

EU banks will need to reduce their balance sheets by €3.2T and raise nearly €50B in capital over the next five years in order to comply with Basel III, FT says, citing an RBS study.

The banks flagged as the "most in need of fresh capital" are Barclays (BCS), Crédit Agricole (CRARY.PK), and — not surprisingly — Deutsche Bank (DB).

Smaller banks will need to cut €2.6T in assets, a prospect which suggests lending to small businesses could dry up.

More: Deutsche to shed assets, FDIC vice chair says bank is undercapitalized.

Even more: Barclays to bridge capital shortfall with rights issue, CoCos.