The Impact of Basel III

December 19, 2012

The new Basel III norms, which are to be implemented from January 1, 2013, should render the global banking system much less vulnerable.

Heard of the Basel III norms yet? You should have! They are being implemented on January 1, 2013 and will have an impact on the global banking system. But will it be good or bad? Here’s an opinion piece published in Business Standard which says:

“The new Basel III norms, which are to be implemented from January 1, 2013, should render the global banking system much less vulnerable. But their implementation starts at a time when Indian banking is under stress.”

Imarticus Learning’s Chief Faculty, Harish Thakkar has this to say:

“Basel III norms effective Jan 1st 2013 is certainly a welcome move in the direction of better governance but it is going to be a herculean task implementing it until 2018. Easier said than done, Banks will have a challenge raising capital in form of Equity and non-equity paper. Market buoyancy and valuations will largely define the appetite for issues. Also with new players entering the Banking space , business will be more competitive thereby impacting the valuations and ability to attract investors. Given the budgetary constraints , the government may also be short on fulfilling its capital infusion targets. Any delays by government will only complicate the maths further.”

Click here to read the full piece in Business Standard. We look forward to hearing your thoughts in the comments section below or on our official Facebook and Twitter pages.

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