Turbulent Basel III finalisation and emerging regulatory agenda

By Bozena Gulija

Banking prudential regulation has entered a more ambiguous phase. The post-crisis consensus was defined by broad convergence around a common goal to rebuild resilience through stronger capital, reducing unwarranted risk-weighted asset (RWA) variability, tighter liquidity and leverage backstops. That architecture remains in place, and the final Basel III package continues to serve as a common reference point. What has changed is the geopolitical environment and the political economy surrounding those global standards, both of which are now shaping their national implementation. The debate is no longer only about resilience. It has increasingly become about competitiveness, simplification, emerging risks, technological change and potential migration of intermediation towards non-banks. The result is not a collapse of the Basel framework, but a more visibly differentiated prudential order observed in the European Union (EU), UK and US. The forward-looking regulatory agenda is also adjusting its content priorities and shifting towards the new topics. The common Basel baseline remains important, but it now coexists with national and regional choices on calibration, scope, transition and supervisory philosophy in an uncertain global environment.