BASEL III NORMS AND IMPACT ON INDIAN BANKING SYSTEMSUBMITTED
By:Mohit JainNidhi ThakurNitikaPallaviPavneet KaurPawasPiyushPranit
JainPoran SaikiaTrisha BoseINTRODUCTION
BASEL III NORMSREQUISITES FOR BASEL IIICapital adequecy
ratioTier I capitalCapital bufferLiquidity standards
BASEL IIBased on 3 pillars:Credit riskMarket riskOperation
riskREASONS FOR FALIUREDIFFERENCE BETWEEN BASEL II AND III
IMPACT OF CAPITAL ADEQUECY ON INDIAN BANKSDifficulty in reducing
tier-I capitalNo resecuritization exposureTrading books are
small
IMPACT OF CAPITAL BUFFER ON INDIAN BANKSAdditional cost have to
be incurredReduction on return on equityRestriction on leverage
IMPACT OF LIQUIDITY STANDARDSUse of retail banking business
modelDifficulty in collecting dataAmbiguity in treatment of SLR
LIMITATIONS IN INDIAN CONTEXTNo impact of recessionNo sub-prime
mortgagesNot exposed to fluctuating marketsADVANTAGES OF BASEL
IIIPSU on the safer sideStandardization for the upcoming
banksCONCLUSION..
