29 January 2020
Basel III - Overview of international Basel 3 impacts
Basel 3 regulation aimed at providing a common level-playing field across all regions, business models and size. From a worldwide perspective, its primary objective is not increase minimum required capital but rather (i) to provide better comparability and harmonisation of regulatory playing field at worldwide level ; (ii) limit potential bias provided by internal model approach.
Nevertheless, preliminary impact studies – yet known to be based on conservative hypothesis – demonstrate Basel 3 may indeed generate a non negligible increase in capital for some banks. The cost of a level playing field is already under scrutiny, especially in Europe, where the legal transposition of Basel 3 raise many questions at regional level.
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