Minimum Capital Requirements for Market Risk: Developments in Basel Regulation

Research Paper (undergraduate) from the year 2017 in the subject Business economics - Investment and Finance, grade: 1,0, University of Mannheim, language: English, abstract: The Basel framework has gone through substantial transformation during the last couple of years amidst a political, regulatory and societal environment that has pushed for stricter and more prudential supervisory activity. This has been a natural development as it became clear that the regulatory framework proved to be inappropriate to cope with the latest developments in the financial services industry. The Basel Committee itself recognized that the pre-crisis regime and overall design of the framework showed material weaknesses in ensuring adequate capital requirements that could absorb the magnitude of losses that the banking industry experienced in 2007/2008.