PNC CEO Says Banks Could Face Tier 1 Capital Standard Of 9%

Regulators may eventually require banks to maintain a Tier 1 capital ratio of 9%, according to the chief executive of PNC Financial Services Group Inc. (PNC)

"It appears as if nine might be a more acceptable level," James Rohr said Tuesday in New York at a Barclays Financial Services conference. Tier 1 capital ratios are a key measure of banks' financial health and regulators have historically required banks to maintain a Tier 1 ratio of 6% in order to be considered "well capitalized."

More recently, regulators have informally pushed banks to raise their ratios to 8%. But Rohr's comments suggest those standards may soon rise more.

Finance officials from twenty industrialized nations will soon gather in Pittsburgh and observers expect the group to address regulation of banks.

In addition, Rohr said PNC's charge for current and future loan losses in the third quarter will be equivalent to the bank's provision in the third quarter. Rohr said that charge will add to the bank's reserve for future loan losses, meaning it will exceed the bank's third-quarter charge-offs.

-By Marshall Eckblad, Dow Jones Newswires; 212-416-2156; [e-mail]