LONDON (AP) — Britain's Financial Services Authority warned yesterday it would not wait for new international rules on banks' capital needs, saying Britain would move ahead with its own regulations if a global deal is not struck soon.

With banking stability at the top of the international reform agenda following the global credit squeeze, Bank of England Governor Mervyn King also revealed that the central bank plans to put in place a standing liquidity facility.

Liquidity, or the ready cash banks need to conduct daily operations, has emerged as a key issue in the current credit crunch as banks have been fearful of lending to one another and central banks have stepped in to provide added short-term credit.

FSA chairman Callum McCarthy said ensuring liquidity was too important for regulators to delay on reforms to introduce stronger risk management measures for banks.

"The present crisis started with liquidity pressures," McCarthy told the first annual meeting of the British Bankers' Association, which represents 230 banks from around 60 countries that operate in Britain.

McCarthy said that banks need to have a clear assessment of the liquidity risks they are running and regulators could not wait for guidelines that are being developed under the Basel II protocol that has been developed to govern the capital adequacy of financial institutions world-wide.

"We simply can't be in a position of waiting for Basel to come in," said McCarthy. "We will press ahead on a national basis because to do anything else would be inappropriate."

BBA chief executive Angela Knight told the conference earlier that the association supported greater regulation in the wake of the global credit crisis, but warned that duplicate legislation could prove costly to competitiveness.

"Three sets of rules will be two sets too many for the international industry," said Knight. "What we do here in the UK must match others ... maintaining competitiveness is essential to the UK industry."

Bank of England governor King said he supported McCarthy's comments as he outlined plans for a new, standing liquidity facility to offer short-term credit to banks as part of the Bank of England's so-called "Red Book" to be announced later this year.

King said that emergency lending auctions by central banks, such as the coordinated action by the Bank of England and its counterparts in Europe and the US in December, can be useful but a "more continuously available facility may sometimes be needed to avoid an immediate loss of confidence."

"We intend ... to put in place a liquidity facility that works in all seasons both 'normal' and 'stressed'," King said at the BBA conference, without providing details.