Basel Accord

The Basel Accord refers to a set of international banking regulations established by the Basel Committee on Banking Supervision to ensure that financial institutions maintain adequate capital reserves. The main goal is to promote stability in the global financial system by minimizing the risk of bank failures. The accords set standards for capital requirements, risk management, and supervision of banks, enhancing both the safety of individual banks and the overall banking environment. There are three versions—Basel I, II, and III—each adapting to changing financial landscapes and addressing new risks in the banking sector.