Strengthening banks' capital positions: a first look at the effects of the Basel Committee's proposals

Giuseppe Lusignani and Lea Zicchino ()

Banca Impresa Società, 2010, issue 2, 237-268

Abstract: This paper analyses the impact on banks' regulatory capital of the Basel Committee's proposals for revising the capital adequacy framework. It provides a preliminary estimate of how much capital banks, in Italy and the rest of Europe, might need to accumulate as a result of losses related to the crisis and to satisfy the new and more stringent regulatory constraints on capital and leverage ratios envisaged in the proposal; it analyses the different strategies banks can adopt to adjust to the new regulatory framework and, finally, it discusses the impact that this might have on the cost of capital.

Keywords: Reform of capital adequacy rules; capital ratios; leverage ratios; cost of capital. (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:mul:jqmthn:doi:10.1435/32151:y:2010:i:2:p:237-268

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