One of the main lessons from the financial crisis was that the rules governing the banking system were rather inadequate. We saw excessive risk-taking, insufficient loss absorbing capacity and banks that were “too big to fail” – to name just some of the problems that led to the crisis.
Regarding capital requirements, the most important regulatory measure was Basel III, which introduced not only stricter capital requirements but also new liquidity rules. In the EU, CRD IV and CRR ensure harmonised implementation of the Basel III framework across all member states.