>RE-PLUMBING THE FINANCIAL SYSTEM (CITI)

What G20 means for leverage, credit and growth

■ The G20 communique and associated BIS announcements demonstrate that the key features of the future financial landscape have already been set

■ New leverage ratio constraints likely to affect European banks most

■ Securitization policies, in contrast, more likely a negative for the US

■ Near-term market impact likely limited: much of any capital shortfall likely to be redressed via retained earnings

■ However, long-term implication is for higher costs of credit, slower growth, and lower bank returns on equity

To see full report: FINANCIAL SYSTEM