Basel Reforms Require Further Review
- Kenneth E. Bentsen, Jr.
The following commentary was originally published in Bloomberg Brief: Financial Regulation & Risk on August 26, 2016.
Kenneth E. Bentsen, Jr., President and CEO of SIFMA, and CEO of the Global Financial Markets Association (GFMA), discusses the wide-reaching impact of Basel reforms on markets and the economy following the release of a report by Oliver Wyman, commissioned by the GFMA. GFMA is SIFMA’s global affiliate.
“Following the financial crisis, G-20 Leaders agreed to take steps to enhance financial stability, which led to an unprecedented regulatory overhaul driven by the Financial Stability Board and Basel Committee on Banking Supervision. This resulted in significant increases in capital and liquidity and lower leverage, complemented by measures to improve market infrastructures and reduce risks from concentrated exposures and interconnectedness. While the standards developed greatly improved the resilience of the financial system, which has since proved itself in both real and simulated periods of stress, they were developed independently and their impacts were evaluated mainly in isolation. As a result, there has never been a comprehensive analysis of their aggregate impact on the structure and functioning of banks and financial markets, nor on economic costs, growth and job creation.”
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