As the world haltingly recovers from the recession, regulators are struggling to modify the financial system to prevent another crisis. The latest effort: stricter capital requirements to help prevent large banks from collapsing under the weight of unexpected losses.

The new proposals — called Basel III for the organization that coordinated the negotiations, the Basel Committee on Banking Supervision — are designed to reduce risk-taking by increasing a key capital requirement to 7% of assets from the previous 2% international standard and the 4% used by large U.S. banks. But the committee, worried that discouraging banks’ willingness to lend would slow the recovery, recommended phasing in the rules over eight years. While many experts say the proposals move in the right direction, some critics say the rules are too weak and too slow to take effect.

“I’m not impressed with its rigor,” says Wharton finance professor Richard J.…