Abstract
Banking sector is considered as a backbone of any economy. It not only transacts money but also helps in promoting trade credit and various social welfare schemes of government. With the changing scenario of business, banking has also undergone a paradigm shift. From manual banking it has shifted to computerized core banking and moving fast towards paperless banking with the use of internet and mobile technology. With the expansion of banking activities, various types of risks associated with banking business have also expanded. To counter them, Basel I guidelines were issued in 1988, the loopholes of which were covered in improved guidelines issued in 1996 known as Basel II. The economic slowdown of 2008 revealed that risk containing measures were not enough to enable the banks in absorbing shocks arising from financial and economic stress. Thus, to improve the ability of banks to withstand the economic and financial stress, Basel III guidelines were issued in December 2010. The present paper attempts to explore the areas where Basel III supersedes its previous accord and how it strengthens the banks to face the periods of economic and financial adversaries.
Published Version
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