What is Basel III?


"Basel III" is a comprehensive set of reform measures, developed by the Basel Committee on Banking Supervision, to strengthen the regulation, supervision and risk management of the banking sector. These measures aim to: 

* Improve the banking sector's ability to absorb shocks arising from financial and economic stress, whatever the source

* Improve risk management and governance

* Strengthen banks' transparency and disclosures

The reforms target:
* Bank-level, or microprudential, regulation, which will help raise the resilience of individual banking institutions to periods of stress

* Macroprudential, system wide risks that can build up across the banking sector as well as the procyclical amplification of these risks over time


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