Social and Behavioral Sciences Commons^™

Third Time’S The Charm: Will Basel Iii Have A Measurable Impact On Limiting Future Financial Turmoil?, Erin Pentz

Penn State Journal of Law & International Affairs

The Great Recession of 2008 caused banking failures around the globe. The Basel Committee on Banking Supervision responded swiftly to create new minimum capital requirements for financial institutions in hopes of preventing additional failures and warding off future crises. Although the new capital standards that Basel III proposes are a step in the right direction, those standards alone will not be sufficient to prevent future bank failures in times of economic decline. Rather, true financial sector stability requires adequate capitalization of all institutions in terms of quality and quantity of capital, a strong regulatory framework, and a limitation on the …