A coalition of large US state pension funds has backed the private equity industry's opposition to new rules on takeovers of troubled lenders, saying they have a “chilling effect” on attempts to revive the country's banking system.

The warning by funds from states including New York, New Jersey and Oregon, which manage billions of dollars on behalf of public workers and are big investors in private equity, will strengthen the buy-out industry's lobbying against the proposed measures.

Under the planned rules, unveiled by regulators last month, private equity groups that buy a troubled bank would have to maintain its tier one capital ratio – a measure of financial strength referring to a bank's equity capital and reserves – to 15 per cent of assets. This would be three times the level of other banks. Buy-out funds would also be banned from selling their lenders for three years under the plans.