Standard & Poor’s is planning to develop its own tools to measure the strength of banks’ balance sheets after concluding that the Basel II framework for setting capital ratios is too complicated to allow comparisons between different lenders.

The ratings agency plans to use information disclosed by the banks to adjust Basel II ratios and make them more easy to compare when setting credit ratings. The move is significant because ratings issued by agencies such as S&P are crucial in determining the rates at which banks can borrow in the financial markets.