Quantitative modeling of the relationship between Basel III Capital Buffers and key strategic solutions: A case study of commercial banks in Vietnam

The Basel III Capital Buffers were introduced by the Basel Committee on Banking Supervision after the 2008 global financial crisis to strengthen global bank stability by providing additional capital layers that can absorb potential losses and manage excessive credit growth. In Vietnam, the implementation of these buffers has presented considerable challenges, especially for commercial banks, where tailored solutions must be customized to align with the unique scale, structure, and characteristics of each institution. This article examines the impact of various strategic approaches on implementing Basel III Capital Buffers in Vietnamese commercial banks. The regression research model employs a 5-level Likert scale, using a questionnaire of 6 variables representing 40 distinct indicators, in a survey conducted across 115 banking institutions in Vietnam. The findings reveal that strategies for capital increases through securities issuance, reinvestment from business activities, and system upgrades significantly influence buffer implementation. Securities-related capital increases have the most significant effect, followed by system upgrades and business reinvestment. In contrast, delays in state capital injections and persistent operational challenges hinder progress. The study offers practical recommendations to enhance Basel III compliance in Vietnam by optimizing capital management strategies and addressing key implementation barriers to ensure the long-term resilience of the banking sector.

Authors

Institutions

Publication Details

Journal
Edelweiss Applied Science and Technology
Published
2025-05-06
DOI
https://doi.org/10.55214/25768484.v9i5.6931
Primary Topic
Insurance and Financial Risk Management
Type
article
Field-Weighted Citation Impact
0.00
Controls
|||
ALL TIME
JAN
FEB
MAR
APR
MAY
JUN
JUL
AUG
SEP
OCT
article

Quantitative modeling of the relationship between Basel III Capital Buffers and key strategic solutions: A case study of commercial banks in Vietnam

Khuong Nguyen, Michelle Vu, Thu Huong Nguyen
Edelweiss Applied Science and Technology
Insurance and Financial Risk Management
article

Quantitative modeling of the relationship between Basel III Capital Buffers and key strategic solutions: A case study of commercial banks in Vietnam

Khuong Nguyen, Michelle Vu, Thu Huong Nguyen
article en

Abstract

The Basel III Capital Buffers were introduced by the Basel Committee on Banking Supervision after the 2008 global financial crisis to strengthen global bank stability by providing additional capital layers that can absorb potential losses and manage excessive credit growth. In Vietnam, the implementation of these buffers has presented considerable challenges, especially for commercial banks, where tailored solutions must be customized to align with the unique scale, structure, and characteristics of each institution. This article examines the impact of various strategic approaches on implementing Basel III Capital Buffers in Vietnamese commercial banks. The regression research model employs a 5-level Likert scale, using a questionnaire of 6 variables representing 40 distinct indicators, in a survey conducted across 115 banking institutions in Vietnam. The findings reveal that strategies for capital increases through securities issuance, reinvestment from business activities, and system upgrades significantly influence buffer implementation. Securities-related capital increases have the most significant effect, followed by system upgrades and business reinvestment. In contrast, delays in state capital injections and persistent operational challenges hinder progress. The study offers practical recommendations to enhance Basel III compliance in Vietnam by optimizing capital management strategies and addressing key implementation barriers to ensure the long-term resilience of the banking sector.

Edelweiss Applied Science and TechnologyVol. 9(5)
The State Bank of Vietnam (VN), Banking Academy of Vietnam
Openalex Percentile: Top 85%
Insurance and Financial Risk Management
AI Navigator

Ask Laika to Summarize, Analyze, and Connect papers live on the map.

Summarize Papers & Methodologies

Extract key findings, datasets, and comparative methods across publications.

Benchmark Rankings & Visual Analytics

Rank top research institutions, authors, funders, topics, and journals by Field-Weighted Citation Impact (FWCI) and paper volume with instant charts.

Connect Distant Disciplines

Bridge topological clusters on the map to find hidden collaborative intersections.