A series of international banking regulations developed by the Basel Committee on Banking Supervision to strengthen regulation, supervision, and risk management of banks worldwide. Basel I, II, and III progressively increased capital requirements and risk controls.
Named after Basel, Switzerland, where the Bank for International Settlements is headquartered. The Basel Committee was formed in 1974 following major bank failures, with Basel I introduced in 1988 after the Latin American debt crisis.
Basel accords are like global building codes for banks - just as construction standards prevent buildings from collapsing in earthquakes, Basel rules prevent banks from collapsing in financial storms. Basel III was the response to 2008, requiring banks to hold much more capital as a safety cushion!
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