Seven years after the collapse of Lehman Brothers jolted theglobal economy, the world's biggest banks may need to raise as muchas US$1.2 trillion to meet new rules laid down by financialregulators.

After years of work, the Financial Stability Board (FSB),created by the Group of 20 nations in the aftermath of the crisis,published its plan for making sure giant lenders can be wounddown and recapitalized in an orderly way, without taxpayerbailouts.

Under the rule for total loss-absorbing capacity, or TLAC,most systemically important banks must have liabilities andinstruments “readily available for bail in” equivalent to at least16 percent of risk-weighted assets in 2019, rising to 18 percent in2022, the FSB said on Monday. A leverage ratio requirement willalso be imposed, rising from 6 percent initially to 6.75 percent.The banks' shortfall under the 18 percent measure ranges from 457billion euros to 1.1 trillion euros ($1.2 trillion), depending onthe instruments considered, according to the FSB.