The Basel Committee on Banking Supervision released a consultation paper on Wednesday proposing changes to the leverage ratio that was adopted as part of the Basel III capital adequacy framework, in response to the financial crisis.

The committee says “a simple leverage ratio framework is critical and complementary to the risk-based capital framework and that a credible leverage ratio is one that ensures broad and adequate capture of both the on- and off-balance sheet sources of banks’ leverage.”

The proposed revisions to the design of the Basel III leverage ratio reflects the regulators’ monitoring of the existing rule, and feedback from market participants and others, since the requirements were introduced in January 2014.

Among other things, the proposed revisions would alter how derivative exposures are measured; clarifies the treatment of illiquid positions; and proposes options designed to ensure consistency across accounting standards. The regulators are also proposing an additional leverage ratio requirement for global systemically important banks (G-SIBs).

In response to the proposed changes, the Futures Industry Association (FIA), a U.S.-based trade group for the global derivatives industry, expressed disappointment that the new framework does not include an offset for initial margin, which, it says, is impacting global derivatives markets. “We are seeing a declining number of clearing members, greater concentration of risk, and reduced access for hedging,” says Walt Lukken, president and CEO of FIA, in a statement.

“It’s critical that we get the calculation for the leverage ratio right,” Lukken adds. “The leverage ratio should not stand in the way of the G-20’s goal of reducing systemic risk through greater adoption of central clearing. Our concern is that this will make it more difficult for market participants to hedge risk using cleared derivatives. Worse, it may harm the safety and resilience of our clearing system.”

Alongside the proposed changes, the Basel Committee also published an updated version of its frequently asked questions (FAQs) document that provides guidance on implementing the leverage requirements.

Comments on the proposed revisions are due July 6, and the committee aims to finalize the rule by the end of the year.