BASEL III

and It’s Impact on the

Profitability of the
Banking Sector
of Bangladesh
2
INTRODUCTION

Rumana Rahman Bristy

Tracking ID-570078
3
TABLE OF CONTENTS

BACKGROUND of TIER 1&2

BASELII VS III
BASEL III CAPITAL

CURRENT ESTABLISHING
RATIOS of
IMPLEMENTATION ADDITIONAL
BASEL III
STATUS of BASEL III BUFFERS

BASEL III & CONCLUDNG

PROFITABILITY REMARKS
4

BASEL III
5
BASEL II vs III
6
BACKGROUND OF BASEL III

Increasing the Quality and Quantity of Capital

Tier -1 Capital

Tier -2 Capital
7
Tier-1 Capital

Paid up Share
capital Premium

Statutory General
Reserve Reserve

Retained Minority
Earnings Interest
8
Tier-2 Capital

General Reserve for Reserve for Subordinate

Provision fixed assets Securities d Bond
10
ESTABLISHING ADDITIONAL BUFFERS

Capital
Countercyclical
Conservation
Buffer (0-2.5%)
Buffer (2.5%)
10

Ratios of
BASEL III
11
RATIOS

Liquidity
Coverage Ratio Leverage Ratio
≥ 100% ≥ 3%

Net Stable
Funding Ratio
≥ 100%
12

Current Implementation
Status
of
BASEL III
14
TRENDS IN CRAR

▸ Source: Department of Off-site Supervision (DOS), BB.

14
TRENDS IN AGGREGATE PROFITABILITY

*June, 2018.
Source: Department of Off-site Supervision (DOS), BB.
15
TRENDS IN CRAR BANK GROUP WISE

Source: Department of Off-site Supervision (DOS), BB.

16
TRENDS IN LCR
17
TRENDS IN NSFR
18
TRENDS IN LEVERAGE RATIO
19

Relationship Between
BASEL III & PROFITABILITY
 d
ke y.
lin ilit
y
el t a b
tiv ofi
g a pr
n e s’
is k
II a n
lI b
se the
Ba ith
w
20
21
CRAR & PROFITABILITY

CRAR

ROE

CRAR

ROA
23

Foreign commercial
banks are the
strongest group in
terms of compliance
with the standards of
Basel III
23

state-owned banks
and specialized banks
are far below the
complying
standards
24

CONCLUDING
REMARKS
25

Better Risk
Governance Management

Self-
Comprehensive
developed Capital
Strategy. Adequacy
Framework
THANK YOU