Basel III and Prudent Risk Management in Banking

Karikari Amoa-Gyarteng

International Journal of Financial Markets, 2016, vol. 2, issue 2, 33-38

Abstract: This paper analyzes whether or not Basel III can sanitize the banking industry and enhance prudent risk management tendencies. The paper analyzes the framework and juxtaposes the drawbacks against the potential benefits. Basel III is essential insofar as it represents a major globally accepted guideline for risk management in banking. However, its flaws are gaping. It fails to ascribe regulation of credit rating agencies and it does not plug some of the loopholes under Basel III. These inadequacies notwithstanding, Basel III in the opinion of this paper is a useful framework and it will help in bringing about prudent risk management in the banking sector.

Keywords: Financial crisis; Basel III; Capital; Liquidity; Leverage; Risk (search for similar items in EconPapers)
Date: 2016
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