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Capital Constraints by Regulation in Europe

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Abstract

This chapter aims at describing the evolution of the capital adequacy framework for banks at international scale. As known, the main reasons for the introduction of Basel III link back to the crisis and the inability of banks to adequately deal with its consequences, mainly due to operational distortions that have gradually characterised the banking business in the last decades. In order to give response to the crisis, the current framework focuses on the provision of higher-quantity and better-quality own funds, the introduction of countercyclical buffers, the discipline of rules for managing liquidity risk and the containment of leverage.

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Author information

Authors and Affiliations

  1. Department of Economics and Management, University of Pisa, Pisa, Italy

    Paola Ferretti

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  1. Paola Ferretti
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Editors and Affiliations

  1. Department of Economics and Management, University of Pisa, Pisa, Italy

    Fabiano Colombini

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Ferretti, P. (2018). Capital Constraints by Regulation in Europe. In: Colombini, F. (eds) Raising Capital or Improving Risk Management and Efficiency?. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-71749-4_5

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  • DOI: https://doi.org/10.1007/978-3-319-71749-4_5

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  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-319-71748-7

  • Online ISBN: 978-3-319-71749-4

  • eBook Packages: Economics and FinanceEconomics and Finance (R0)

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