Finalising Basel III

Abstract

On 7 December 2017, the Group of Central Bank Governors and Heads of Supervision (GHOS) concluded an intensive and difficult round of negotiations by endorsing the final Basel III package of reforms. This wrapped up the fundamental reform of the global regulatory framework for banks which had been initiated in response to the financial crisis. The first part of the Basel III reform package, which defined far stricter capital, liquidity and leverage ratio standards, was adopted by the Basel Committee on Banking Supervision back in 2010. The December 2017 round of reforms amend the requirements for the calculation of credit and operational risk which banks are expected to back with capital. Updated minimum capital requirements for market risk had been adopted by the GHOS at the beginning of 2016.