Basel III is a key regulation that is aiming to build on the
already existing Basel II regulation by series of amendments. The
regulation is considered one of the most critical for global
financial stability considering the destabilizing role the banking
sector had played during the latest global economic meltdown. The
Private Equities, like rest of the actors in the global markets,
will benefit from the strengthening of the banking sector and
reining in of the destabilizing capabilities of the banking sector
by the Basel III regulations.
The new regulation is going to bring stringent rules for the
banks to operate. Core solvency ratio for the banks will be
retained as the 8% of the risked weighted assets as well as a 2%
increase is introduced to the minimum common equity requirement
that will raise it to 4.5% by 2015. Moreover, by 2015 the capital
base, including common equity, will increase from 4% to 6%. There
will also be a capital conservation buffer requirement
