When fully implemented, Basel III will increase the quantity and quality of capital held by banks by:

Question

Quizplus · Accepted Answer

When fully implemented, Basel III will increase the quantity and quality of capital held by banks by increasing the CAR and the amount of 'tier 1' equity capital. This is because 'tier 1' equity capital is considered the highest quality capital that a bank can hold, and increasing the amount of this capital will increase the strength and stability of the bank's balance sheet. Additionally, Basel III introduces stricter guidelines for the quality of capital, which means that banks will need to hold capital that is more reliable and less likely to be depleted in times of financial stress.

When Fully Implemented, Basel III Will Increase the Quantity and Quality