Basel 4

Basel 4 as it is dubbed by the financial industry is a proposed standard on capital reserves for banks, to mitigate against the risk of financial crisis. It is expected to follow the third Basel accords (Basel III) , and would require more stringent capital requirements and greater financial disclosure.[1]


Basel 4 is likely to include:[2][3]

British banks alone may have to set aside another £50Bn of reserves to meet Basel 4 requirements.[4]


Basel III's rules increased the amount of capital that banks must hold, and set a core tier 1 capital ratio of 7%. The technical implementation deadline for Basel III is 2019, but recent developments in the banking market have suggested that even stricter rules may be applied by a later framework, which has been dubbed "Basel 4".[5] The Basel Committee on Banking Supervision released a consultative paper, seeking out views on the Committee's plan to change how capital requirements and market risks are calculated.[6]

External links


  1. "Regulators look ahead to 'Basel 4'". ICAEW. Retrieved 18 May 2014.
  2. "Basel 4 – Emerging from the mist". KPMG. Retrieved 18 May 2014.
  3. "South Africa: Basel 4 – Emerging From The Mist?". Mondaq. Retrieved 18 May 2014.
  4. "KPMG: UK Banks Facing New £50bn Capital Hole as 'Basel IV' Emerges". International Business Times. September 12, 2013. Retrieved 18 May 2014.
  5. "KPMG Warns Over £50 Billion 'Basel 4′ Capital Hole". Moneybeat. Retrieved 18 May 2014.
  6. "Introducing "Basel 4"?… Basel Proposes Changes to Trading Book Market Risk Capital Requirements". Advantage Reply.
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