On 17 July, the CRD IV package which transposes via a Regulation and a Directive, the new global standards on bank capital (the Basel III agreement) into EU law, entered into force. The new rules which will apply from 1 January 2014 tackle some of the vulnerabilities shown by the banking institutions during the crisis, namely the insufficient level of capital, both in quantity and in quality, resulting in the need for unprecedented support from national authorities. They set stronger prudential requirements for banks, requiring them to keep sufficient capital reserves and liquidity. This new framework will make EU banks more solid and will strengthen their capacity to adequately manage the risks linked to their activities, and absorb any losses they may incur in doing business.
The European Commission has also issued a FAQ on CRD IV/CRR.