##ed in 2017 by the final basel iii standards. they focused on enhancing the risk - weighting framework, introducing more robust capital floors, and limiting the variation in banks'internal risk models. these standards, by now famously known as the basel endgame, have not yet been implemented by jurisdictions around the world. the eu, in its implementation, deviated on important points, making banking regulation weaker than agreed in the new standards. in the us and the uk, initial legislation proposals have also been weakened, 1 / 4 bis - central bankers'speeches with some elements not fully aligned with the basel iii agreement. legislators also point at each other when making these adjustments. us banks spent tens of millions of dollars on a lobbying campaign that included ads in the middle of american football games. i don't think it's ethical to interrupt football games for any kind of message, let alone on basel iii. but on a serious note : our failure to implement fully what had already been agreed upon back in 2017 should be worrying. not only to me, as a regulator, but also to you, as bankers. to explain why, let me give you my version of a pro - basel lobbying commercial. implementation of basel iii will increase the credibility of capital ratios and strengthen the banking sector. think of it as a safety net, your safety net. it will ensure that when the next economic shock comes - and it will come - you will be better prepared to withstand it. the capital buffers required by basel iii are not a burden ; they are a shield, allowing you to absorb losses while maintaining operations, protecting your customers and preserving your reputation in times of stress. many in the banking sector view regulation as a constraint, something that limits profitability and imposes undue costs. but it's just the other way around. basel iii is not an obstacle to growth, it is an enabler of sustainable, long - term growth. banks with strong capital positions and sound liquidity management are better positioned to extend and rollover credit, invest in new technologies and fund large - scale projects. they are better able to maintain lending during an economic downturn. and stronger banks can secure more favourable funding conditions, attract long - term customers and build partnerships that increase shareholder value. basel iii works best when it works everywhere. when basel iii is implemented unevenly across jurisdictions, it creates a patchwork of regulations that opens the door to regulatory arbitrage. banks may be tempted to shift operations to regions

klaas knot : a solid foundation for a resilient structure speech by mr klaas knot, chair of the financial stability board and president of the netherlands bank, at the central bank of ireland's macroprudential policy for investment funds conference, dublin, 20 may 2024. * * * good afternoon. it is great to be back in dublin in this impressive building of the central bank of ireland. the dutch central bank will be moving into its renovated headquarters in december, so i can't help paying attention to my architectural environment. but that's not the only reason. the way architects look at the foundation and resilience of their buildings resembles the way the financial stability board ( fsb ) looks at the financial system. a structure, after all, is only as strong as its weakest point. 15 years ago, the global financial system was on the verge of collapse. there were, in fact, many weak points. but, we know that non - banks, including investment funds, played a role in that global financial crisis1. more recently, there was the march 2020 turmoil2, and indeed other incidents, such as the failure of archegos and the ldi turmoil. these events have been further reminders of one simple fact : there remain key vulnerabilities within nbfi. the basic regulatory structure is not strong enough. in recent years, the fsb and the international standard - setting bodies have been working hard to address these nbfi vulnerabilities. we have made progress, but there is still more to do. just like this fantastic building, we are aiming to construct something that can stand the test of time. something that functions well through hot spells and big storms. for a resilient structure we need a solid regulatory foundation. then, macroprudential measures could be added to the design to further support the structure, where needed. measures that may change over time and could differ from one jurisdiction to the next. measures that are complements to, but not substitutes for, the baseline set of regulations. therefore, to me, a successful macroprudential approach depends on the completion and proper implementation of the international regulations the fsb has been developing. in the remainder of this speech, i will discuss in more detail the fsb's recent work in the area of investment funds and nbfi more broadly. i will then offer some thoughts on the next steps at the international level towards a