Basel II established minimum capital requirements, procedures to ensure that sound internal process are used to assess capital adequacy and set targets that were commensurate with the risk profile and environment in an endeavour to protect solvency of individual FIs.Basel III introduced liquidity and higher capital levels to protect the financial system in general.

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Basel II and Basel III are regulatory frameworks for banks and financial institutions introduced by the Basel Committee on Banking Supervision. Basel II aimed to establish minimum capital requirements and internal processes for assessing capital adequacy, while Basel III introduced additional requirements for liquidity and higher capital levels to protect the financial system as a whole.

Basel II Established Minimum Capital Requirements, Procedures to Ensure That