Effects of Basel III on the business segment of internacional project finance.
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Discipline/sAdministración y Dirección de Empresas
Subject/sOrganización y Gestión de Empresas
The origin of this work is to be found in the subprime crisis and the resulting chain reaction via the financial crisis and the global economy crisis to the Basel III regulatory framework. The losses of the financial crisis had a direct impact on the banks’ capital value and thus on the leverage ratio. As a reaction to the financial crisis the Basel Committee was once again forced to act and, as a result, they published a first draft of Basel III in 2010. The international project finance has its origin in capital-intensive major infrastructure projects where the financing amount mostly ranges from hundreds of millions of euros or up to several billions of euros which are in jointly structured and financed by a number of global banks. Project finance has been established on the market as a safe and reliable financial product. Because of their special character with long-term agreements, market fluctuations only have little to no effect on running projects and that is why projects in o...