Bankers said today media reports claiming that Australia's banks have won an exemption from tough new international rules are incorrect.

Steven Münchenberg, Chief Executive of the Australian Bankers' Association (ABA) said: "There have been media reports today noting that the Australian Government has won exemptions for Australia's banks from tough new international rules on banks, known as Basel III, at the G-20 meeting in Korea. This is not the case."

"The Australian Government and the banking regulator, the Australian Prudential Regulation Authority (APRA), have made it clear that Australia's banks will need to meet standards as tough as those set internationally. This is also the expectation of the international community."

The new international rules will require banks to hold greater levels of liquid assets. At the international level, most banks will meet this requirement by holding government bonds.

Mr Münchenberg said: "Australia, along with other countries, such as Singapore and Hong Kong, do not have deep government bond markets because our Governments have not run significant deficits. Even if our banks bought all the Australian Government bonds on issue, we would not have enough to meet the tough new requirements."

"The Australian Government and the Australian regulators have recognised this situation and there is acknowledgement that some countries will need to include other assets to achieve the new requirements."

"There is, however, a very clear expectation that the level of liquidity coverage for Australian banks will be just as high as banks in other countries that meet the new Basel III rules. There is no exemption for Australia's banks from the rules."

ABA said, at this stage, banks have not yet been advised by APRA of the assets that can be included when the new liquidity requirements come into effect. APRA has advised that it will consult with the banking industry once the new international rules have been settled.