Although the Basel III norms are yet to be calibrated, it is unlikely that they will be higher than the above figures. As such, we do not expect our banking system to be significantly stretched in meeting the proposed new capital rules both in terms of the overall capital requirement and the quality of capital. 11.
Indian banks already make most of the deductions from capital now being proposed under Basel III. Moreover, our banks do not have re-securitisation exposures and their trading books are small. However, there may be some negative impact arising from shifting some deductions from Tier I and Tier II capital to common equity. 12.