The Research On The Procyclicality Of Capital Requirements Under The Background Of Financial Crisis

Every crisis will cause people to think deeply about the economic and financial field. Since the 1980s, there were three crises that caused people to doubt the validity of bank supervision and pay high attention to financial security. In the 1980s, America savings and loan crisis indicated the huge risk that caused by banking executives confederated with government official in the process of global capitalism; The southeast Asian financial crisis of the 20th century told us that we could avoid financial turmoil only through making a thorough reform, improving the banking supervision system, eradicating causes for bank non-performing loan; Theoretical and empirical horizon have various arguments as to the causes for the current U.S. subprime mortgage crisis, but it is gaining consensus that the current financial supervision and approaches need to be adjusted.As an international banking unified regulatory framework, every revision of Basel not only solves some problems but also brings some new problems.The BaselⅡenhance the risk sensitivities of capital regulation, but also lead to the procyclicality. This paper argues,the capital regulation model under the guidance of Basel is an important factor that induced and accelerated the global financial crisis which caused by the U.S subprime mortgage crisis.An important task of the macro-prudential framework is to study the mechanism of the procyclicality of capital requirements.On one hand, measures should be taken to mitigate the procyclicality of the Basel II risk-based capital requirements. On the other hand, counter-cyclical instruments should be introduced, so as to mitigating the procyclicality of credit,the volatility of asset prices and the economic growth.This would significantly contribute to mitigating financial imbalance and the build-up of systemic risk,so as to enhance financial stability.China banking regulatory commission stipulate banks with higher degree of internationlization should implement the new accord before 2013.Therefore, before the deadline,commercial banks should choose the right time to implement the new Basel according to itself and macroeconomic situation, refer to the experiences of developed countries and take measures to alleviate the procyclicality of capital requirements.