Basel III: problems and consequences of implementation in foreign banks

Kateryna Olegivna Ivanyi


Abstract


The purpose of the paper is to study the problems and analyze the consequences of implementation of Basel III in foreign banks. According to the purpose of the article ithas been determined the evolution of requirements of the Basel Committee on banking supervision in the banks activities. The article clarifies that in terms of Basel III recommendations most of the banks will increase current requirements to the size and quality of capital, liquidity and the proportion of debt capital. Banks, which have a more complex structure, will face with changes in the credit risk of counterparties, more stringent mechanism of market risk and, furthermore securitization changes during applying the requirements of Basel III. It has been determined that the extent of the transition to a particular cycle is significantly different in all countries. These global differences further complicate the situation. Also it has been revealed that today the major part of Russian banks (PJSC "Alfa-Bank" PJSC "Bank of Moscow", etc.) executes the capital adequacy requirements. At the same time, the rules which are adopted by the Basel Committee, provides a transitional period for the banks to have the performance. The practical significance of the results lies in the identifying specific practical arrangements for complete implementation of the Basel Committees’ recommendations. 


Keywords


capital; Basel III; Tier I capital; Tier II capital; capital adequacy; capital requirements; regulation

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References


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Science Works Journal "Ekonomichnyy analiz"

ISSN 1993-0259 (Print)  ISSN 2219-4649 (Online) DOI: 10.35774/econa


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