Will the UK remain a signatory to the Basle Capital Convergence Agreement of July 1988 post Brexit?

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Published by a ��˾��ҹ�� Financial Services expert

Published on: 04 January 2018

The Basel Accords—Basel I, II and III

The Basle (or Basel) Capital Convergence Agreement of July 1988, is the original text of the first Basel Capital Accord (Basel I), which set down an agreement among the G-10 central banks (including the UK and non-EU countries such as the United States of America and Japan) to apply common minimum capital standards to their banking industries originally to be achieved by end of 1992. It focUsed mainly on credit risk by creating a bank asset classification system and the appropriate risk weighting of assets.

The second Basel Accord, the Revised Capital Framework (Basel II) served as an update of Basel I and focused on three main areas, minimum capital requirements, supervisory review of an institution’s capital adequacy and internal assessment process and an effective use of disclosure to strengthen market discipline and encourage sound banking practices (ie the three pillars).

Following the Lehmans Brothers collapse of 2008 and the ensuing financial crisis, the Basel Committee on Banking

Jurisdiction(s):

United Kingdom

Key definition:

Convergence definition

What does Convergence mean?

A term used to describe a variety of technological and market trends involving the blurring of previously distinct lines between market segments such as cable television, telephony and Internet access, all of which can now be provided through a variety of different network platforms.

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