On 12 September, as part of activities of the Group of Central Bank Governors and Heads of Supervision (GHOS), the Basel Committee set out its expectations on Basel III implementation.
Basel III is a comprehensive package of proposals for reforms prepared by the Basel Committee on Banking Supervision in response to the financial crisis of 2008. It is based on the provisions of the Basel II Accord. It seeks to strengthen the regulation, supervision and risk management in the banking sector. The proposed reforms aim to improve the banking sector’s capacity to absorb shocks from economic pressures, streamline risk management and internal governance, and increase transparency and access to information.
The Committee’s task is to strengthen banking regulations, supervision and practices throughout the world to increase financial stability. The Committee reports to the Group of Central Bank Governors and Heads of Supervision and seeks its approval in important decisions. The Committee has no formal international power and its decisions do not have legal effect. More than two thirds of EU jurisdictions are planning to implement all or most of Basel III standards in 2023 or 2024; the others are planning to implement them in 2025. The members of the GHOS unanimously reaffirmed their expectation that all aspects of the Basel III framework will be implemented fully and consistently, and as soon as possible. This aims to ensure equal regulatory opportunities for banks engaged in international activities.