Reports over the past 24 hours say proposed Basel III Rules may set banks' Tier 1 capital at a minimum six per cent of assets. The figure is at the high end of previous expectations.As regulators met last night in Switzerland to hammer out details of the Basel III rules, specifics of the rules were becoming clearer. Secrecy conditions imposed by the Basel Committee, the group drawing up global banking rules, have kept the likely shape of the global rules unusually vague until now.The Federal Association of German Banks, the BdB, was reported on Tuesday as saying the Basel Committee would likely require a six per cent minimum ratio of Tier 1 capital to risk-weighted assets. That compares with a four per cent minimum ratio under the current Basel II regime.The BdB also expected banks would have to hold a so-called "conservation buffer" of two per cent. And it said the maximum countercyclical capital buffer, to be invoked at times of high credit growth, was also likely to be set at two per cent.The Bdb reportedly said the Tier 1 minimum and each of the buffers probably would be composed of 80 percent of top quality or "core Tier 1" capital, which consists of equity capital and retained earnings.Respected German weekly Die Zeit reported even higher figures of three per cent each were being proposed for both the conservation buffer and the maximum countercyclical capital buffer. Die Zeit also reported that the Basel Committee was proposing a six per cent Tier 1 minimum ratio. On top of that would come Tier 2 capital which Die Zeit said could go as high as four per cent.The Die Zeit report also suggested "core Tier 1" capital - essentially, pure equity - would be set at a minimum of five per cent, with the conservation buffer and countercyclical capital buffer both to have core tier 1 capital of 2.5 per cent.The Die Zeit report implies total Tier 1 capital could be required to be as high as nine per cent at all times and up to 12 per cent during peaks of credit growth.As reported in yesterday's Banking Day, the Australian Prudential Regulation Authority (APRA) says Australian banks reported an average Tier 1 ratio of 9.2 per cent in their 2009 financial statements. Under the new rules that ratio would fall to 8.6 per cent.That indicates a number of Australian banks would need new capital to meet a nine per cent ratio.But they will probably have plenty of time to get there. The BdB was also reported as saying regulators were discussing giving banks six to eight years to move to the new rules - a period it called an "absolute minimum". Die Zeit's report broadly agreed, saying the introduction of the conservation buffer would be staggered between 2014 and 2018.The long transition period is seen as the key mechanism to allow adjustment by some of the national banking industries hit hardest by the rules, such as Germany. The BdB estimates Germany's 10