Basel III: Difference between revisions
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Among other reforms, Basel III aims to reduce moral hazard and the related 'too big to fail' problem. | Among other reforms, Basel III aims to reduce moral hazard and the related 'too big to fail' problem. | ||
It also places substantially greater emphasis on harmonised liquidity and funding risk standards. | |||
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Important changes introduced by Basel III include: | Important changes introduced by Basel III include: | ||
*Significant increases in requirements for the quality and amounts of capital; | *Significant increases in requirements for the quality and amounts of capital; | ||
*Capital buffers; | *Capital buffers; | ||
*The Leverage Ratio. | *The Leverage Ratio; | ||
*The Liquidity Coverage Ratio and Net Stable Funding Ratio. | |||
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* [[Microprudential]] | * [[Microprudential]] | ||
* [[Moral hazard]] | * [[Moral hazard]] | ||
* [[Net | * [[Net Stable Funding Ratio]] | ||
* [[CertICM]] | * [[CertICM]] | ||
* [[Sell-side firm]] | * [[Sell-side firm]] | ||
Revision as of 11:50, 17 November 2016
Bank supervision
A third amended and strengthened international bank capital adequacy framework issued in 2010 and updated in 2011, designed to improve on Basel II.
Basel III leverage ratio framework and disclosure requirements were issued in January 2014.
Among other reforms, Basel III aims to reduce moral hazard and the related 'too big to fail' problem.
It also places substantially greater emphasis on harmonised liquidity and funding risk standards.
Basel III has been implemented in the European Union on a phased basis under its Capital Requirements Directive IV (CRD IV).
The phase-in period runs to 2019.
Important changes introduced by Basel III include:
- Significant increases in requirements for the quality and amounts of capital;
- Capital buffers;
- The Leverage Ratio;
- The Liquidity Coverage Ratio and Net Stable Funding Ratio.
Basel III is sometimes written Basel 3.
See also
- Bank supervision
- Basel Committee on Banking Supervision
- Basel II
- Basel 2.5
- Basel IV
- Capital adequacy
- Capital buffer
- CRD IV
- Dodd-Frank
- Financial Stability Board
- Fully loaded Basel III
- Liquidity Coverage Ratio
- Leverage Ratio
- Macroprudential
- Microprudential
- Moral hazard
- Net Stable Funding Ratio
- CertICM
- Sell-side firm
- The future of pooling
- Too Big To Fail
- Volcker Rule
Other links
Basel III in progress but much to be done: An update, John Grout, ACT January 2013
Basel III leverage ratio framework and disclosure requirements January 2014
