Basel III: Banks Expect Lower Profits

Businessn.a. ♦ Published: November 11, 2010; 13:09 ♦ (Vindobona)

Private banks will have to adjust to lower profits because of Basel III regulations..

Basel III: Banks Expect Lower Profits / Picture: ©

The returns on equity will, depending on the business model of the bank amount to 15 to 20%, says the president of the Bankenverband (BdB, Banking Association), Andreas Schmitz, in an interview with the Reuters news agency.

Basel III demands a higher capital base from the banks. "More capital for the same business leads to lower returns on equity." This in turn could lead the…