Guest Contributor | Sep 22, 2020 | 0
The road towards Basel III
Setting the scene for the probable implementation of Basel III, the Director for Strategic Communications and Financial Sector Development in the Bank of Namibia, Ndangi Katoma explained that the central bank would not operate in a vacuum with regards to the implementation of Basel III and outlined that the central bank was seeking the necessary expertise of industry stakeholders.
Katoma said,“The Bank of Namibia is in the process of formulating a position paper on the implementation of Basel III in Namibia in order to assess the feasibility, impact and readiness of the country. The process of implementation will be guided by what comes from the position paper and will be followed by a consultative and collaborative approach, which will involve the industry as was the experience during the implementation of Basel II Capital Adequacy Requirements for Banks.”
He stressed that the reform measures were not only meant to increase the capital of the commercial banks where it was deemed to fall short but, to also strengthen the regulation, supervision and risk management practices of the banking sector.
“The measures further aim to improve the banking sector’s ability to absorb shocks arising from financial and economic distress, whatever the source these frameworks are aimed at improving risk management and governance practices and strengthen the transparency and disclosure requirements of capital for banks,” he added. New entrant EBank would in its initiation phase need to meet the Basel II standards currently in force.
“It should be noted that Capital Adequacy standards for banks are applicable to each and every bank because all banks are subjected to the same requirements. Consequently, banks are continuously assessed on these capital adequacy standards to ensure the risk that they have on their books are commensurate with enough capital,” said Katoma