And as many of you know, the UK has ring-fencing rules in place that separate the vital basic functions of a bank from the riskier ones. Even though this policy is not of the Basel Committee’s making, the UK is of course free to apply this add-on to the Basel rules in its jurisdiction.
The second qualification is that Basel standards are intended for, and tailored to, large, complex, and internationally active financial institutions. As a result, the rules themselves have become large and extremely complex, and Basel III is certainly no exception here. Appropriate as they are for the global players, the rules tend to overburden small institutions.