The Basel iii regulations are expcted to come into force by the end of 2012, and banks and lenders need to start considering what effect the changes will have on business.
The rules will seek to set further restrictions of risk and will bring in new rules on liquidity, affecting commercial mortgage brokers, bank lenders and the wider banking industry as a whole.
The Basel iii Compliance Professionals Association (BiiiCPA) says: “We are committed to move together in a transparent and coordinated way on national implementation of the agreed rules. Implementation of these new rules should be complemented by strong supervision.”
The Association continues to explain how the new restrictions are intended to prevent a repeat of the credit crunch that led to widespread financial meltdown, “It is critical that our banking regulators develop capital and liquidity rules of sufficient rigor to allow our financial firms to withstand future downturns in the global financial system.”
Banks must be aware that they will need to adhere to the new rules in order to ensure they have the funds to lend.