| Summary: | 碩士 === 國立中正大學 === 國際經濟研究所 === 103 === It appears that there are too many financial institutions with small business scales in the trend of financial globalization in recent years. It becomes an important issue to examine financial indicators to control the risk and asset quality of Taiwan’s banks according to a three-stage adjustment of capital adequacy ratio in Basel. This study adopts an Ordinary Least Squares model (OLS) to evaluate the impact of capital adequacy ratio in three-stage Basel agreements on the financial performance of 25 banks in Taiwan in the years of 1988 to 2013.
Empirically compare the impact of the three-stage capital adequacy rate in Basel on banks’ profitability, over lending, and market value of assets. The results show shareholders' equity was reduced significantly in BASEL III, however, returns on assets were raised in BASEL III. The results clearly verify that in accordance with the requirement of higher capital adequacy ratio can reduce banks’ risk and enhance their overall average returns on assets (ROA). But increasing banks’ capital leads to the reduction in returns on equity (ROE). More implications of BASEL Accords on banks’ financial performance deserve future studies.
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