'Basel III Accord' or simply 'Basel III', often seen in the news, seeks to
Answer & explanation
Answer: (b) improve banking sector's ability to deal with financial and economic stress and improve risk management
Basel III is a set of global banking rules from the Basel Committee on Banking Supervision. It was framed after the 2007-09 financial crisis. It makes banks hold more and better capital and liquidity, so they can withstand stress, and it strengthens their risk management.
- ✓ (b) Basel III raises the quality and level of bank capital so banks can absorb losses in times of stress. It also adds liquidity standards and a leverage ratio, and it strengthens supervision and risk management.
- ✗ (a) National strategies for conserving biological diversity come under the Convention on Biological Diversity, not a banking accord.
- ✗ (c) Cutting greenhouse gas emissions, with a heavier burden on developed countries, describes the Kyoto Protocol under the UNFCCC. Basel III has nothing to do with it.
- ✗ (d) Technology transfer to replace CFCs in refrigeration relates to the Montreal Protocol on ozone-depleting substances. It is not a banking standard.
Remember · Basel norms come from the Basel Committee on Banking Supervision (BIS). Basel III was the response to the 2007-09 crisis and covers capital, leverage, liquidity and risk management of banks.
Sources
- BIS – Basel III: international regulatory framework for banks ↗ “Basel III is an internationally agreed set of measures developed by the Basel Committee on Banking Supervision in response to the financial crisis of 2007-09. The measures aim to strengthen the regulation, supervision and risk management of banks.”
- BIS – Basel III: A global regulatory framework for more resilient banks and banking systems ↗ “increasing the level of capital requirements to ensure that banks are sufficiently resilient to withstand losses in times of stress”
Question: UPSC Civil Services (Preliminary) 2015, General Studies Paper I. Explanation: Minimalist IAS, checked 25 Oct 2026 (how we verify). ·
