Earlier this week, the Basel Committee on Banking Supervision (BCBS) met to discuss recent market developments and risks to the global banking system. In that meeting, BCBS members reaffirmed their commitment to fully implementing Basel III.
This is despite a global swing toward deregulation, as politicians and the public push regulators to emphasize growth and competitiveness. In the US, for instance, the fate of the so-called "Basel Endgame" proposal remains unclear as the incoming administration seems eager to strip away what it sees as unnecessary regulation.
The Committee also discussed its work to develop a suite of practical tools to support supervisors. This is one part of an effort to "strengthen supervisory effectiveness in light of the lessons learned from last year's banking turmoil," the BCBS said. "This work covers the supervision of liquidity risk and interest rate risk in the banking book, the assessment of the sustainability of banks' business models, and the importance of effective supervisory judgment." The BCBS will publish an update on this undertaking in early 2025.
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