The impact of Basel III, also known as The Third Basel Accord, will vary by geography -- from potentially slowing down economies in emerging nations, to protecting the European Union from financial collapse, to increasing capital adequacy and improving risk management. Given the framework and timeline for implementing Basel III, the burden falls on national regulators to translate the international guidelines into national policies that suit and stabilize their economic environment and support economic growth.

1. Dissecting Basel III by GeographyWhile Basel III regulations apply worldwide, the challenges of implementation vary across economies.
Executive SummaryBasel III, also known as The Third Basel Accord, was created as an addendum to Basel II regula- tions following the financial crisis of 2008. While Basel III standards are intended to apply globally, compliance will understandably require a differ- ent approach by each region and/or economy. We believe that the impact of Basel III will vary widely by geography — from potentially slow- ing down the economies in emerging nations, to safeguarding the European Union from financial collapse, to increasing capital adequacy and com- prehensive risk management. In this paper, we will examine the implications of Basel III for emerging markets, Europe and the U.S. We will also outline an approach that each region/economy can adopt to comply with these norms. And finally, we will lay out some of the challenges involved in implementing the mecha- nisms and propose solutions to help overcome the challenges associated with Basel III. Triggers for Basel III The financial crisis of 2008–2009 exposed the inadequacies of the Basel II framework — prompt- ing the banking community to draft new mechanisms to avert future crises (see Figure 1, next page). The result, Basel III, was designed to supplement Basel II, rather than supplant it.
Basel III enhancements cover four broad domains: • The quality and quantity of capital. • Liquidity standards and stable funding. • Checks on leverage and counterparty risk management. • More comprehensive and transparent disclo- sures. Some of the major features of Basel III focus on: • Capital quality. Basel III introduced a much stricter definition of capital — mandating that banks hold higher-quality capital to absorb more loss and cushion themselves during periods of financial stress. • Capital conservation buffer. Banks are now required to hold a capital conservation buffer of 2.5%. This buffer is intended to ensure that these institutions maintain a reserve that can be drawn down during periods of financial and economic uncertainty. • Countercyclical buffer. The countercycli- cal buffer was established to increase capital requirements in good times and lower them in bad times. The buffer is meant to slow banking activity when it overheats and encourage lending during periods of slow economic growth. The buffer will range from 0% to 2.5%, and consist of common equity or other fully loss-absorbing capital. cognizant 20-20 insights | november 2014• Cognizant 20-20 Insights

2. cognizant 20-20 insights 2
The Evolution of Basel III
Pre-
Basel
No Standard
Rule for Capital
Adequacy
1996
Amendment to
Include Market
Risk Standard
2004
Basel II Release
Enhanced Credit
Risk Standards &
Inclusion of Market
Risk Standard
2009
Basel 2.5
Better Manage
Securitization
Exposure, New
Capital Requirements
for Exposures in
the Trading Book
July
1988
Basel I
Credit Risk
Calculation
Standard
1998
Introduction of
Framework for
“Internal Control
System in Banking
Organization”
2007-
08
Revised
Framework,
Inclusion of
Operational Risk
Standard
Enhanced
Framework for
Credit Risk, Market
Risk, Operational
Risk & Introduction
of Liquidity Risk
2010-
11
• Capital requirements. The minimum require-ment for common equity, the highest-quality
capital, has been raised from 2% to 4.5% of
total risk-weighted assets. The overall Tier-1
capital requirement, which comprises common
equity as well as other qualifying financial
instruments, will also increase from the current
minimum of 4% to 6%. Although the minimum
total capital requirement will remain at the
current 8%, when it is combined with the con-servation buffer the total capital required will
increase to 10.5%.
• Leverage ratio. During the financial crisis
of 2008, the value of many assets fell faster
than had been expected, based on history.
The Basel III norms include a leverage ratio to
serve as a safety net. A leverage ratio is the
relative amount of capital to total assets (not
risk-weighted). The leverage ratio is intended
to cap inflammation of leverage in the global
banking sector. A 3% leverage ratio of Tier 1
will be tested before a mandatory leverage
ratio is introduced in January 2018.
• Liquidity ratios. Basel III incorporates a
framework for liquidity risk management,
consisting of Liquidity Coverage Ratio (LCR)
and Net Stable Funding Ratio (NSFR), to be
introduced in 2015 and 2018, respectively, as
shown in Figure 2.
• Systemically Important Financial Institu-tions
(SIFI). Systemically important banks
will be subject to a 1%–2.5% capital surcharge
above the minimum capital level, capital con-servation and countercyclical buffer require-ments introduced under Basel III.
Implications and Challenges Across
Geographies
Emerging Nations
Economic Environment
Although emerging nations have different eco-nomic
environments, they can be grouped
together, given their volatile financial markets;
stronger credit growth; higher inflation; fairly
small-sized bond markets; lower credit ratings;
comparatively higher fiscal deficit burden; and
other macro factors. Figures 3 and 4 on the fol-lowing page depict the GDP growth rate and
inflation rate of the BRIC nations (Brazil, Russia,
India and China).
In these countries, the state has a majority stake
in the banking sector. All the BRIC nations rely
heavily on public sector banks, which comprise
about 75% of the banks in India, 69% or more
in China, 45% in Brazil, and 60% in Russia.1
Therefore, in these countries the government will
have to shoulder the burden of conforming to the
new policies.
Impact on the Economy
Basel III’s introduction of the leverage ratio will
induce global banks to limit their lending in cer-tain regions and reduce exposure to specific risky
asset classes. This could adversely affect the
economy if financial conditions are tightened.
Although the banks in emerging nations already
have high Tier-1 capital ratios (their capital
structure usually comprises equity and reserve),
stringent policies on certain financial instru-ments might discourage foreign investments. The
introduction of capital buffers should not pose a
significant challenge, given the already high capi-tal adequacy maintained by these banks.
Figure 1

3. cognizant 20-20 insights 3
Banks will be incentivized to adopt internal rat-ings- based methods to measure credit risk, rather
than using a standardized approach to allocate
risk weights more prudently. However, this will
require redesigning IT and risk-management sys-tems. The emphasis on high-quality liquid assets
will eventually reduce private-sector lending and
compel governments to issue more debt. Using
central counterparties (CCPs) for trading in OTC
derivatives may be unfavorable for countries
where the transaction volume is not high. This
could potentially shift business from small coun-tries to countries where there are CCPs.
Cost to the Economy
The implementation of Basel III and the higher
capital requirements might slow these countries’
rapidly expanding economies; implementing the
Risk
Category
PILLAR 1 PILLAR 2 PILLAR 3
Capital and Risk Coverage Risk Management and
Supervision
Market Discipline
Credit Risk
CAPITAL
1) Revision of Quality of Capital Tier 1 & Tier 2
2) Raised minimum Capital Requirement to
4.5% of RWA
RISK COVERAGE
1) Counterparty credit risk
2) Bank exposures to central counterparties
(CCPs)
1) Economic capital modeling
2) Enhanced firm-wide stress
testing
1) Enhanced disclo-sure of capital
2) Business and
economic portal
Market Risk
CAPITAL
1) Introduction of Capital Conservation
Buffer, i.e. 2.5% of RWA
2) Introduction of Counter Cyclical Buffer
(0-2.5%) of RWA
RISK COVERAGE
1) Significantly higher capital for trading and
derivatives activities.
2 Introduction of a stressed value-at-risk
framework to help mitigate pro-cyclicality.
1) Capturing the risk of
off-balance sheet expo-sures and securitization
activities
2) Managing risk
concentrations
3) Stress testing and
simulations
4) Portfolio management,
limits management
5) Large exposures/concen-tration
risk
6) Interest rate risk in the
banking book
1) The requirements
introduced relate
to securitization
exposures and
sponsorship of
off-balance-sheet
vehicles.
Liquidity Risk
LIQUIDITY COVERAGE RATIO
The liquidity coverage ratio (LCR) will require
banks to have sufficient high-quality liquid
assets to withstand a 30-day stressed funding
scenario that is specified by supervisors.
NET STABLE FUNDING RATIO
The net stable funding ratio (NSFR) is a
longer-term structural ratio designed to
address liquidity mismatches. It covers the
entire balance sheet and provides incentives
for banks to use stable sources of funding.
1) Principles for sound liquid-ity risk management and
supervision
2) Supervisory monitoring
metric definition
1) Increased fre-quency
and
auditability of
Pillar 3 reporting
Operational Risk
RISK COVERAGE
Securitizations:
Strengthens the capital treatment for certain
complex securitizations. Requires banks to
conduct more rigorous credit analyses of
externally rated securitization exposures.
CONTAINING LEVERAGE
Leverage ratio:
A non-risk-based leverage ratio that includes
on/off-balance sheet exposures will serve as
a backstop to the risk-based capital require-ment. Also helps contain system-wide buildup
of leverage.
1) Providing incentives for
banks to better manage risk
and returns over the long
term; sound compensation
practices; valuation practices;
stress-testing; accounting
standards for financial instru-ments; corporate governance;
supervisory colleges.
2) Contingency Planning and
Legal Risk
1) Disclosure on
securitization
2) A comprehensive
explanation of how
a bank calculates its
regulatory capital
ratios
Basel III Pillars for Withstanding Credit, Market, Operational
and Liquidity Risk
Figure 2

4. cognizant 20-20 insights 4
new and sophisticated stress-testing processes
for risk management will pose significant tech-
nical challenges. The introduction of the capital
conservation buffer will also bring more pressure
when it comes to maintaining core capital ade-
quacy. The state will be required to increase its
borrowing per year, which will increase the fiscal
deficit of the country. The emphasis on keeping
more funds in liquid assets — mostly cash, cen-
tral bank reserves and marketable securities
representing claims on or claims guaranteed by
sovereigns, central banks and public sector enter-
prises — may drive out private sector investments,
thereby negatively impacting the country’s GDP
growth. A longer implementation timeline and
relaxed liquidity requirements will go a long way
in easing the costs that emerging nations will
have to incur.
European Union
Economic Environment
The banking sector in the EU nations plays a sig-
nificant role in providing financial intermediation
and credit to the economy. Unlike in the U.S., the
banking sector is pivotal to the EU economy, and
marked by its large asset holdings when com-
pared to the size of the respective GDPs. For
example, bank assets in Ireland and Switzerland
are around seven to five times their respective
GDPs.2 The drive to harmonize payments within
the entire EU through SEPA End Date regula-
tions and other similar directives has resulted in
increasing cross-border payments and lending
within the EU region. As such, the impact of Basel
III regulations will be felt throughout that region
and thus must be tackled homogenously by all
member states.
0
2
4
GDP Growth (%)
6
8
10
12
2010 2011 2012
BRAZIL RUSSIA INDIA CHINA
7.5
4.5
2.7
4.3
6.6
9.3
0.9
3.4
4.7
7.8
10.3 10.4
Annual GDP Growth Rate of
BRIC Nations
Source: http://databank.worldbank.org/data/views/
reports/tableview.aspx
Figure 3
2010 2011 2012
BRAZIL RUSSIA INDIA CHINA
0
2
4
6
8
10
12
5
6.6
8.4
8.9
5.4 5.4 5.1
9.3
2.7
6.9
12
3.3
Inflation Rate (%)
Annual Inflation Rate of
BRIC Nations
Source: http://databank.worldbank.org/data/views/
reports/tableview.aspx
Figure 4
0
100
200
300
400
500
600
700
800
Austria
Belgium
Bulgaria
Czech Rep.
Denmark
Estonia
Germany
Greece
Hungary
Ireland
Latvia
Lithuania
Macedonia
Malta
Poland
Portugal
Romania
Russia
Slovakia
Slovenia
Switzerland
UK
2010
2011
2012
BANK ASSETS (AS % OF GDP)
Bank Assets as Percentage of GDP in EU
Source: OECD, National Statistical Office, National Central Bank
Figure 5

5. cognizant 20-20 insights 5
Impact on the Economy
The EU plans to implement Basel III through
two legislative acts — the Capital Requirements
Regulation (“CRR”) and the Capital Requirements
Directive (“CRD”), known together as CRD IV.
In order to restrict regulatory arbitrage, The
European Banking Authority will be the ombuds-man
for uniform implementation across the EU
region. Almost all financial institutions — from
deposit-taking banks to building societies and
investment firms — are subject to Basel III regu-lations. They have the independence to select
their own methodology (Standardized, Internal
Ratings-Based Foundation or Internal Ratings-
Based Advanced) to model their credit risk. The
regulation incentivizes financial institutions to
improve their credit risk assessment models
and reduce over-reliance on external credit rat-ings
to optimize the capital charge allocation.
The EU region has to act in unison to strengthen
the financial stability of the whole region, since
its nations are closely integrated economically. It
thus requires integrated regulatory frameworks,
risk management and financial monitoring.
Cost to the Economy
Considering the size and importance of its bank-ing
sector, the EU region stands to benefit the
most from the new Basel III regulations. At the
same time, the variance in sovereign credit risk
among the member states and the large public
debt accumulated by some states present a
challenge to the uniform implementation of the
regulatory framework. The decline in investor
confidence and rising sovereign credit risk will
escalate the cost of credit for banks and other
economic participants. The increase in funding
costs will adversely affect the real economy and
destabilize the financial system through banks’
increasing credit loss. Therefore, it becomes
imperative for individual nations to improve their
national balance sheets. Finally, the diverse eco-nomic
environments in the member states have
the potential to create imbalance in the region.
As such, a coordinated and integrated approach
is required for policy implementation.
United States
Economic Environment
Traditionally, the U.S. has been a market-based
economy; its banking sector was determined to
be one of the sources of the 2008 financial crisis.
The U.S. had the largest system of non-bank finan-cial
intermediation at the end of 2012, with assets
of US$26 trillion. The U.S. share of total non-bank
financial intermediation for 20 jurisdictions (see
Figure 6) and the Euro area increased from 35%
to 37% at the end of 2012.3
Considering the contribution of non-banking
institutions in the U.S., it is important to formu-late more resilient risk-management standards
for this sector, which has so far been loosely reg-ulated. There is concern that implementing Basel
III (which is primarily applicable to the banking
sector) might result in a lot of risky activities
being shifted from banking to non-banking insti-tutions — thus defeating the purpose of achieving
financial stability.
Source: http://info.publicintelligence.net/FSB-ShadowBanking-2013.pdf
Figure 6
U.S.
China
UK
Switzerland, 2%
Korea, 2%
Japan, 5%
Hong Kong, 1%
Euro Area, 3%
Canada, 2%
Brazil, 2%
Australia, 1%
37%
31%
12%
Share of Assets of Non-Banking Financial Intermediaries

6. cognizant 20-20 insights 6
Impact on the Economy
The U.S. economy faces the unique challenge of
protecting its smaller banks from over-regulation
while bringing the entire financial sector — both
banking and non-banking — under regulatory
scrutiny. In July of 2013, the Board of Governors of
the Federal Reserve System (the Federal Reserve)
and other bank regulatory agencies approved
the “Final Rule,” which implements many
aspects of the Basel III framework agreed upon
by the Basel committee and also incorporates
changes required by the Dodd-Frank Act. However,
there are a few differences in some of the
requirements imposed by the U.S. Basel III when
compared to the international norms. Notable
among these are:
• Different eligibility criteria for additional Tier 1
capital.
• Introduction of permanent Collins Amendment
capital floor.
• Prohibits referring to external credit ratings.
Cost to the Economy
The U.S. Basel III final rule applies to the entire
U.S. banking sector — from community banks and
regional banks, to the largest and most global U.S.
banking organizations, to U.S. bank subsidiaries
and U.S. bank holding companies. Community
banks will face significant costs under Basel III,
since the high capital requirements will raise
their funding costs. The capital buffers may
create additional capital-raising burdens for
smaller banks.
The large banks wield influence over the
supervisory agencies — allowing for nuanced
interpretation and a creative approach to imple-menting the regulations. This could lead to banks
conforming to the policy only in letter, and not
in spirit. Responsible and transparent decision
making by national regulators is therefore crucial
for implementing the policy framework.
Cost/Benefit Analysis of Basel III
The regulatory reforms under Basel III mandate
that banks hold significantly higher levels of
capital and liquidity while reducing the amount
of eligible capital. Consequently, the redefini-tion
of eligible capital and risk-weighted assets
has significantly lowered the capital ratios. The
new framework has increased pressure on
banks’ return on equity (ROE); many banks may
report negative ROE in the short term. Whereas
large institutions may have the wherewithal to
conform to the new regulation, there are con-cerns that smaller banks might be crowded out.
Moreover, the macroeconomic environment
varies widely by geography — impacting the
implementation of Basel III norms. A “one size fits
all” approach will therefore not work.
The macro-prudential capital and liquidity
buffers — along with increased risk management
and more transparent and comprehensive disclo-sure — are expected to enhance banks’ capacity
to withstand shocks, thus reducing the risk of a
systemic banking crisis. Nonetheless, to meet
the new norms, most banks, especially small-er
institutions, will have to raise capital from
the markets, which will result in higher interest
rates, increased cost of capital and reduced ROE.
There is also the risk of a decline in banking activ-ity, at least in the short term, which could lead
to unfavorable lending conditions. Moreover, the
implementation of the new rules will depend on
the interpretation of a bank’s supervisors, which
could vary across institutions. In addition, if dif-ferent jurisdictions apply different yardsticks for
implementing the Basel III guidelines, this could
lead to international regulatory arbitrage, as wit-nessed under Basel I and Basel II.
Basel III’s complexity and the uncertainty of
the benefits it promises have generated debate.
There is contention surrounding the effectiveness
of the new requirements, such as the counter-
cyclical buffer and the conservation buffer, which
will incur significant costs. Basel III also allows
national regulators to treat their sovereign bonds
as riskless, even though nations’ credit risks vary
widely. The complexity of the rules raises doubts
about its effective implementation and the
achievement of its objective of financial stability.
A Roadmap for Implementation
Given the framework and timeline for implement-ing
Basel III, the onus is on national regulators to
translate the international guidelines into nation-al
policies in a way that suits and stabilizes the
economic environment and sustains their national
economic growth. In countries where the market-
based economy has a dominant role in providing
credit, the application of banking regulations
alone will not be sufficient to bring about finan-cial
stability, since lending activities will move to
the less regulated financial markets. Those econ-omies that have large banking systems compared
to the national GDP need more robust policies
and regulation to avert any financial crisis, as the
cost of a crisis would be far greater for them.

7. cognizant 20-20 insights 7
The cost of adopting the new regulation will
depend largely on the difference between
existing ratios and those mandated by Basel
III. Banks will have to exercise discretion when
raising their capital ratios. Each of the three
broad ways of boosting capital ratios — increas-ing
retained earnings, reducing risk-weighted
assets and issuing new equity — have their pros
and cons (see Figure 7, next page). Reducing risk-
weighted assets by downsizing the loan portfo-lio
will create a shortfall in credit lending, which
in turn will make it difficult for small and medi-um-
sized enterprises to obtain loans. Issuing new
equity may also lead to a drop in lending activi-ties, since banks will have to raise lending rates to
maintain the same level of returns on equity for
shareholders. The best scenario for a bank is to
increase retained earnings by achieving greater
operational efficiency and higher income.
Implications of Various Changes Under Basel III
Quick Take
Cost Benefit
Increased Quality and Quantity of Capital
Significant decrease in banks’ eligible capital and
increase in risk-weighted assets.
Restructuring of balance sheet to improve quality of
capital and management of balance-sheet resources.
Reduced ROE, retention of profits and reduced
dividends.
Improvement in processes and rating models to opti-mize risk-weighted assets.
Introduction of Leverage Ratio
Banks are constrained in growing their business
through external debt.
Banks will be incentivized to strengthen their capital
position.
Banks may take up higher risk/higher return lending,
since the leverage ratio does not take into account
the risks related to assets.
Banks will need to sell low-margin assets.
Introduction of Liquidity Coverage Ratio (LCR)
Banks’ options for managing their assets for maxi-mum
profit become limited, since the profit yield
from liquid assets is usually low.
Banks will be better prepared to withstand potential
liquidity disruptions leading to short-term resilience.
Banks will be required to monitor liquidity risk and
manage liquid assets more efficiently.
Introduction of Net Stable Funding Ratio (NSFR)
The funding cost will increase for those banks that
have difficulty obtaining wholesale deposits with
maturities over one year.
Stronger banks with an already good proportion of
stable deposits will become price leaders, thereby
putting pressure on weaker banks and leading to a
decrease in competition.
Banks will be incentivized to rely less on short-term
wholesale funding and increase stability of the fund-ing
mix.
Introduction of Counterparty Credit Risk Measures
Banks will be required to hold more capital for market
risk when trading in OTC derivatives.
Improvement in counterparty risk management.
The newly introduced credit valuation adjustments
(CVA) will increase RWA.
Banks will be incentivized to improve collateral and
netting arrangements.
Trades with lower-rated counter parties and those
with limited netting ability will be affected the most.
Move to more effective central counterparty
management.

8. cognizant 20-20 insights 8
Banks will need to take cohesive action across all
of their departments — business, operations, risk
management, IT, Finance, Treasury, etc. — in order
to mitigate the impact of the regulations. Some
tactical measures that banks can adopt include:
• Portfolio optimization. Banks should consider
exiting positions that are capital-intensive and
non-core. Restructuring of securitized instru-ments can be carried out in order to get a
more beneficial treatment, such as rebooking
certain security portfolios in banking books
rather than in trading books to avoid stressed
VAR charges. Moreover, optimizing hedging
strategies and choosing counterparties with
strong collateral and netting agreements will
help reduce counterparty risk and credit-value
adjustment charges.
• Adoption of scientific risk-measurement
techniques. The classification of products and
the application of the correct model to each
category can help reduce charges significantly.
The new ratios and charges introduced to take
stock of market and counterparty risk, such as
stressed value at risk (VaR), incremental risk
charge (IRC) and credit value adjustment (CVA)
among others, can be improved by optimizing
the calculation models and ensuring the avail-ability and timeliness of data.
• Financial management. Banks must manage
capital efficiently in order to improve capital
quality and minimize charges. Measures such
as reclassifying financial instruments from
current value to fair value and buying out
minority stakes can reduce certain regulatory
charges. Liquid assets can be efficiently
used by monitoring liquidity risk across the
bank, centralizing liquidity management and
ensuring better access to the market. Eligible
funding can be employed effectively by quickly
reacting to changes and opportunities for
optimizing costs, closely monitoring funding
plans and centralizing funding plans.
• Operational efficiency. IT and operations
require a holistic and sustained organizational
focus from CXOs in order to remain steadfast
and efficient in implementing the core business.
The systems’ design should be scalable and
flexible to align with new business models in
less time and at less cost. The use of intelli-gent systems to assist in optimizing resources
with minimal human intervention will support
improved operational risk management.
Conclusion
The tactical measures outlined in this paper
depend on the business model, operational poli-cies and level of preparedness of the institution.
For different geographies, the framework will
have to be customized to accommodate domes-tic
conditions.
Our study of three different geographies points
to variances in economic environments — raising
questions about the effectiveness of the com-plex rules of the Basel III framework. Clearly, the
success of Basel III will depend on transparency,
simple unambiguous policies and a recognition of
regional environments in applying limits and ade-quacy ratios.
Reduce
Risk-
Weighted
Assets
Increase
Retained
Earnings
BOOST
CAPITAL
RATIO
Equity
Infusion
Three Ways to Boost Capital Ratio
Figure 7
References
• Basel Committee on Banking Supervision Reforms — Basel III. http://www.bis.org/bcbs/basel3/b3sum-marytable.
pdf.
• Basel III Regulatory Consistency Assessment (Level 2) Preliminary Report: United States of America.
http://www.bis.org/bcbs/implementation/l2_us.pdf.
• International Regulatory Framework for Banks (Basel III). http://www.bis.org/bcbs/basel3.htm.
• Basel III: A global regulatory framework for more resilient banks and banking systems. http://www.bis.
org/publ/bcbs189.pdf.

9. cognizant 20-20 insights 9
• Basel III Leverage Ratio Framework and Disclosure Requirements. http://www.bis.org/publ/bcbs270.pdf.
• Basel III: The Liquidity Coverage Ratio and Liquidity Risk Monitoring Tools. http://www.bis.org/publ/
bcbs238.pdf.
• Basel III Leverage Ratio Framework and Disclosure Requirements. http://www.bis.org/publ/bcbs270.pdf.
• Basel III: The Net Stable Funding Ratio. http://www.bis.org/publ/bcbs271.pdf.
• Revised Basel III Leverage Ratio Framework and Disclosure Requirements. http://www.bis.org/publ/
bcbs251.pdf.
• Dodd-Frank Act Implementation. http://www.bis.org/review/r120607a.pdf.
• Basel III Regulatory Consistency Assessment (Level 2) Preliminary Report: European Union. http://
www.bis.org/bcbs/implementation/l2_eu.pdf.
• http://www.tradingeconomics.com/united-states/indicators.
• Global Shadow Banking Monitoring Report, 2013. http://info.publicintelligence.net/FSB-ShadowBank-ing-
2013.pdf.
• Financial Stability Analysis — Insights Gained from Consolidated Banking Data for the EU. http://www.
ecb.europa.eu/pub/pdf/scpops/ecbocp140.pdf.
• Macroeconomic Cost-Benefit Analysis of Basel III Minimum Capital Requirements and of Introduc-ing
Deposit Guarantee Schemes and Resolution Fund. https://ec.europa.eu/jrc/sites/default/files/
lbna24603enc.pdf.
Footnotes
1 http://www.globalresearch.ca/public-sector-banks-from-black-sheep-to-global-leaders/29662.
2 http://www.helgilibrary.com/indicators/index/bank-assets-as-of-gdp.
3 http://info.publicintelligence.net/FSB-ShadowBanking-2013.pdf.

10. About Cognizant
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About the Authors
David Hazarika is a Consultant within Cognizant Business Consulting’s Banking and Financial Services
Practice. He has over six years of business and IT consulting experience implementing core banking
solutions, as well as working with leading banks on product development, business process optimization,
business requirement management and gap analysis across various geographic locations. David holds a
bachelor’s degree in electronic and communication engineering from Maulana Azad National Institute of
Technology, Bhopal, and a post-graduate diploma in management from Indian Institute of Management,
Bangalore. He can be reached at David.Hazarika@cognizant.com.
Shantanu Dubey is a Consultant within Cognizant Business Consulting’s Banking and Financial Services
Practice. He has over seven years of business and IT consulting experience in the implementation of
Basel/Regulatory Reporting, Business Intelligence & Core Banking Solution, as well as experience work-ing
with leading banks on product development, business process optimization, business requirement
management and gap analysis across various geographic locations. He holds a bachelor’s degree in
information and technology engineering from RGPV Bhopal, and a post-graduate diploma in manage-ment from I2it Pune. He can be reached at Shantanu.Dubey@cognizant.com.