Higher Bank Capital Ratios : IASB

Where did the recent spate of bank's credit rating by American rating agencies namely S&P and Moody's come from ?

Back track to April 10 2011, a private accounting board albeit international in nature, the International Accounting Standard's Board, states that Bank's capital ratio should be 30% higher probably after being consulted by BASEL III committee that sets banks capital ratios.

Meaning lesser money in the system. And the reverse of leveraging or deleveraging occurs. Just like if the boss keeps more in the kitty, there is less bonus, & less dividend to distribute. So lesser money or lesser credit, more recalling of loans, margin call, will send repercussion ripple effect through the market. Asset values will fall.

http://www.ibtimes.com/articles/132538/20110410/accounting-chief-wants-higher-bank-capital-ratios.htm