Basel III appeared like a dark cloud over sunny Madrid at this excellent EBA Day event. There is plenty of detail that has yet to emerge so discussions and debate is somewhat premature however there was a loud call to arms by the panel of experts.
The issue of intra-day liquidity for banks is key and we have seen over the last few years during the financial crisis how lack of liquidity quickly hurts the international/domestic and local economy and of course the consumer. So Basel III is going to try
and bring more order and asurity of liquidity into the payments arena.
There is no reason why banks should not begin putting together a project team today to assess what data availability they have at central level or on a distributed branch basis to manage intra-day liquidity. This assessment will provide a chance for the
banks to engage with many people across the bank and strategically access the needs of Basel III.
The difficulty of getting the required data together in a suitable form and in time to be able to comply with Basel III should not be underestimated, so an early start looks imperative.
So the message coming from the experts at EBA Day is to get going with your project but be flexible in being able to ammend as more details emerge and Basel III hits the ground running.
This initiative is not to be measured against Basel II, which in many countries never really got off the ground or acheived its intended objectives. Basel III looks like a much better bet.