Implementation of Basel II in Europe Thesis Example | Topics and Well Written Essays - 1500 words

Implementation of Basel II in Europe - Thesis Example The basic aim of this approach is to ensure that the banks and financial institutions must maintain financial soundness and retain the consumer confidence in order to ensure the stability of the financial system and protect the interests of the deposit holders. With these perspectives in mind, Bank of International Settlement formed a Basel Committee on Banking Supervision in 1974 to provide a comprehensive forum for dealing with banking matters of such magnitude. The Basel Committee is made up of senior officials responsible for banking supervision or financial stability issues in central banks and other authorities in charge of the prudential supervision of banking businesses. Members of the Basel Committee come from Belgium, Canada, France, Germany, Italy, Japan, Luxembourg, the Netherlands, Spain, Sweden, Switzerland, the UK and the US. This essay will discuss the implementation process of Basel II in Europe besides discussing some of the challenges and aspects that may raise tensions while implementing the accord in Europe. However, before exploring the issue of the implementation of the BASEL II accord, we will be discussing some of the key issues and points raised by BASEL II in order to implement it in true spirit. Before discussing the BASEL II and its implementation in Europe, it is necessary that a view must be taken in order to provide a historical account of the process of BASEL II implementation in Europe and rest of the world. Bank of international Settlements was established in Basel, Switzerland in 1930 and is considered as the world’s oldest international financial institution. It remains the principal center of international central bank corporations around the world. The BIS was formed as a result of the treaty of Versailles which ended the First World War and BIS was basically established for repatriation