Basel III: An Overview and a Warning

With the December 16, 2010 release of the Basel III rules, the Basel Committee (Basel) aimed to strengthen preventive measures that are at the heart of bank regulation and effective supervision. Examined strictly on its own merits, each of the revamped Basel II rules, as well as the new ones, is sound. There are, however, two major challenges which regretfully have been, and continue to be, outside the Basel Committee’s remit: today’s globalized financial markets are a far cry from the much simpler banking environment that Basel I, and by extension Basel II and Basel III, aimed to regulate, and no matter what the Basel Committee say, the different governments, particularly those in the West, continue to shield their badly wounded big global banks which they saved from bankruptcy through the use of lavish amounts of taxpayers’ money. These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.