The impact of the proposed Basel III liquidity ratios LCR and NSFR on the cost situation and strategic direction of German banks.

  • This thesis deals with the introduction of the proposed liquidity ratios under Basel III and analyses their impact on German banks with regard to their cost situation and strategic direction. Basel III strengthens the liquidity requirements with respect to the size and quality of an obligatory liquidity buffer as well as the funding structure, by enforcing a shift towards more stable long-term funding. Both aspects will have a significant impact on costs. The cost of carrying the liquidity buffer as well as funding costs will increase. Furthermore, the liquidity ratios will influence the demand and attractiveness of products in the long-run, which can lead to a greater competition for certain business segments, but also to a decrease in demand for other segments. Based on their business model and individual characteristics, banks will be differently affected by the liquidity ratios. In order to comply with the new liquidity requirements, German banks will have to analyse the impact on their cost situation and consequently identify and evaluate potential options for changing their investment and funding strategy accordingly. By taking long-term market developments into account, banks might eventually want to align their overall business strategy to the changed regulatory environment.

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Metadaten
Author:Christin Schüler
URN:urn:nbn:de:kobv:b721-opus4-804
Document Type:Bachelor Thesis
Language:English
Date of Publication (online):2013/11/26
Date of first Publication:2013/12/12
Publishing Institution:Hochschulbibliothek HWR Berlin
Granting Institution:Hochschule für Wirtschaft und Recht Berlin
Date of final exam:2013/07/08
Release Date:2013/12/12
Page Number:60