The Institute of International Finance (IIF) has declared that imposing regulations on the banking sector that are "too tough" could result in job losses around the world.

According to a report by the organization, such rules could constrain economic recovery and result in upwards of ten million jobs being lost.

The Independent reports the body has warned against countries adding to the new Basel III regulations for the international finance sector and suggested additional capital targets or levies may affect growth.

Based in Washington, the IIF suggests finance jobs and other roles are reliant on a system of "multilateral co-ordination in addressing key economic and financial regulatory reform challenges" and states in the Group of 20 developed nations should ensure they act together on such issues.

"The challenge is to secure the economic recovery, prevent actions that serve narrow national political interests but compound global problems, and establish a resilient financial system," IIF chairman of the board of directors Dr Josef Ackermann stated.

A collection of over 400 financial institutions in more than 70 countries worldwide, the IIF was founded in response to the international debt crisis in 1983.

Posted by Kate Griffin