Comment on The future global financial landscape by rick

Parent Post: The future global financial landscape

rick · 5/27/2025, 9:16:39 PM · permalink

Is Basel III setting up a new gold-backed monetary system?

Rick Mills - Ahead of the Herd | April 20, 2025 | 8:22 am Markets Europe Gold
![image](https://us-lax-1.linodeobjects.com/sojooo/comments/1278/1748380599430-81f0b01ae574f2f1.png)
https://www.mining.com/is-basel-iii-setting-up-a-new-gold-backed-monetary-sys  
  
%%Is the BIS going to recommend gold as capital asset for banks%%  
BIS Gold Recommendation

The Bank for International Settlements (BIS) has already reclassified gold as a Tier 1 asset for the purposes of Minimum Capital Requirements for banks, valuing it at 100% ("ie. risk weighted at zero percent") when calculating compliance with minimum capital requirements for a bank.

This change took effect under the Basel III regulations, which treat gold held in vaults as a zero-risk asset, equivalent to US Dollars and US Treasuries.

As of July 1, 2025, U.S. banks can count physical gold as a Tier 1 asset for reserve requirements, equivalent to cash or U.S. Treasuries.

How have banks adjusted to higher capital      BIS Quarterly Review, September 2013

requirements?1

Spurred by stronger regulatory requirements, banks have steadily increased their capital ratios

since the financial crisis. For a sample of 82 large global banks from advanced and emerging

economies, retained earnings accounted for the bulk of the increase in risk-weighted capital

ratios over the period 2009–12, with reductions in risk weights playing a lesser role. On

average, banks continued to expand their lending, though lending growth was slower among

advanced economy banks from Europe. Lower dividend payouts and wider lending spreads

contributed to banks’ ability to use retained earnings to build capital. Banks that came out of

the crisis with higher capital ratios and stronger profitability were able to expand lending more.

JEL classification: E44, G21, G28  
![image](https://us-lax-1.linodeobjects.com/sojooo/comments/1278/1748380599569-58d82fdbecdbc50c.png)
https://www.bis.org/publ/qtrpdf/r_qt1309e.pdf

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hyokkim · 7/19/2025, 12:55:07 AM · permalink

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rick · 5/28/2025, 11:14:48 AM · permalink

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