How Basel III helps banks to avoid a crisis

Question

Accepted Answer

Basel III helps banks avoid crisis by strengthening capital requirements, improving risk management, and promoting transparency.

Basel III increases the minimum capital requirements for banks, ensuring they have enough capital to absorb potential losses.
It introduces new liquidity requirements to prevent banks from relying too heavily on short-term funding sources.
Basel III enhances risk management practices by requiring banks to conduct stress tests and hold more capital for risky assets.
It promotes transparency by requiring banks to disclose more information about their risk exposures and capital levels to regulators and investors.