First, how do we fix the problems which all banks faced globally? We have seen that there were relatively similar global failings in banking governance, risk management and capital adequacy. Basel III is the basis for global banking reform efforts to increase the resilience of the banking system, recover market confidence and provide a level playing field for the industry.
Basel III will provide the opportunity to ensure a harmonised set of prudential rules for all credit institutions across every country. In the EU, Basel III is transposed through two pieces of legislation, namely the Capital Requirements Directive and the Capital Requirements Regulation. Negotiations on these items of legislation, which will enter into force in January 2014, were very intense.