Basel III Equity Requirements and a Contemporary Rating Approach
The new equity regulations of Basel III are more restrictive. Therefore the research objective of this article is to show the impact of equity regulations and to provide a proposal for professional preparation for the rating procedure for credit seeking companies. The research method applied is to...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Nicolaus Copernicus University in Toruń
2016-08-01
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| Series: | Copernican Journal of Finance & Accounting |
| Subjects: | |
| Online Access: | https://apcz.umk.pl/CJFA/article/view/10422 |
| _version_ | 1797726208881852416 |
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| author | Günter Hofbauer Monika Klimontowicz Aleksandra Nocoń |
| author_facet | Günter Hofbauer Monika Klimontowicz Aleksandra Nocoń |
| author_sort | Günter Hofbauer |
| collection | DOAJ |
| description |
The new equity regulations of Basel III are more restrictive. Therefore the research objective of this article is to show the impact of equity regulations and to provide a proposal for professional preparation for the rating procedure for credit seeking companies. The research method applied is to give an overview of the relevant equity regulations of Basel III. From this research, we can derive that risk is the most important issue to be considered. In consequence, the outcome is a proposal for a contemporary rating approach for companies, containing an appropriate way how to control risk and perform in an excellent way. We can conclude, that the new equity regulations will not only have an impact on banks, but also on credit taking companies. Especially small and medium-sized companies will be affected. Furthermore in future banks intend to get an exhaustive insight into companies. The risks identified in the business will serve as a measure to calculate a risk adequate interest rate, depending on the rating class. Therefore it won’t be sufficient anymore to use only backward looking statements from the balance sheet or profit and loss statement. In this article we propose an evidence based approach for executing a professional and sustainable rating. Supporting this, we provide six dimensions for a contemporary rating approach.
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| first_indexed | 2024-03-12T10:42:27Z |
| format | Article |
| id | doaj.art-34183af32a1549799629ed0134b2adf9 |
| institution | Directory Open Access Journal |
| issn | 2300-1240 2300-3065 |
| language | English |
| last_indexed | 2024-03-12T10:42:27Z |
| publishDate | 2016-08-01 |
| publisher | Nicolaus Copernicus University in Toruń |
| record_format | Article |
| series | Copernican Journal of Finance & Accounting |
| spelling | doaj.art-34183af32a1549799629ed0134b2adf92023-09-02T07:56:46ZengNicolaus Copernicus University in ToruńCopernican Journal of Finance & Accounting2300-12402300-30652016-08-0151Basel III Equity Requirements and a Contemporary Rating ApproachGünter Hofbauer0Monika Klimontowicz1Aleksandra Nocoń2Technische Hochschule IngolstadtUniversity of Economics in KatowiceUniversity of Economics in Katowice The new equity regulations of Basel III are more restrictive. Therefore the research objective of this article is to show the impact of equity regulations and to provide a proposal for professional preparation for the rating procedure for credit seeking companies. The research method applied is to give an overview of the relevant equity regulations of Basel III. From this research, we can derive that risk is the most important issue to be considered. In consequence, the outcome is a proposal for a contemporary rating approach for companies, containing an appropriate way how to control risk and perform in an excellent way. We can conclude, that the new equity regulations will not only have an impact on banks, but also on credit taking companies. Especially small and medium-sized companies will be affected. Furthermore in future banks intend to get an exhaustive insight into companies. The risks identified in the business will serve as a measure to calculate a risk adequate interest rate, depending on the rating class. Therefore it won’t be sufficient anymore to use only backward looking statements from the balance sheet or profit and loss statement. In this article we propose an evidence based approach for executing a professional and sustainable rating. Supporting this, we provide six dimensions for a contemporary rating approach. https://apcz.umk.pl/CJFA/article/view/10422Basel IIIequity regulationrating classesrisksustainability |
| spellingShingle | Günter Hofbauer Monika Klimontowicz Aleksandra Nocoń Basel III Equity Requirements and a Contemporary Rating Approach Copernican Journal of Finance & Accounting Basel III equity regulation rating classes risk sustainability |
| title | Basel III Equity Requirements and a Contemporary Rating Approach |
| title_full | Basel III Equity Requirements and a Contemporary Rating Approach |
| title_fullStr | Basel III Equity Requirements and a Contemporary Rating Approach |
| title_full_unstemmed | Basel III Equity Requirements and a Contemporary Rating Approach |
| title_short | Basel III Equity Requirements and a Contemporary Rating Approach |
| title_sort | basel iii equity requirements and a contemporary rating approach |
| topic | Basel III equity regulation rating classes risk sustainability |
| url | https://apcz.umk.pl/CJFA/article/view/10422 |
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