27 Aug, 2019
Since the dawn of the twenty first century, the global banking architecture has endured a tsunami of destructive events that have altered the shape of financial regulation in varying ways leading to the creation and subsequent adoption of a new Basel Accord. Basel III emerged amid turmoil in the global financial environment emanating from Subprime Mortgage crisis in the United States.
Financial institutions from across the globe from Northern Rock in UK to Lehman Brothers in the US were victims of this crisis. This thesis explored the regulatory response to the subprime mortgage crisis with particular emphasis on the Basel III accord. Basel I and II were subject to a circumspect examination and critiqued in order to identify the failures that contributed to the financial crisis and the extent to which Basel III has resolved them.
This research relied on doctrinal approach by examining the core provisions of the Basel III accord such as capital adequacy in a bid to identify the impact the new developments will have on the financial sector and its goal of global financial stability.
As a result, a way forward in terms of reforming the Basel Accord and promoting global financial stability provided. Thus, this thesis will inform legal and economic circles on the regulatory failures prior to the financial crisis and the reforms under Basel III as well as its limitations.
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