Subsequent to the global financial crisis (GFC) of 2007�2009, concerns about the financial stability of the banking market were raised around the world including developing countries. As a response to the crisis, the Basel Committee on Banking Supervision (BCBS) promulgated Basel III in 2010 to avert a full-blown crisis. Bank Negara Malaysia announced to adopt the new regulatory reforms in 2013 to improve and enhance Malaysian banks� risk indicators. Previous literature provides conflicting evidence on the effects of Basel III stringent capital prerequisites and in terms of profitability and the stock market. This study aims to develop a conceptual framework to assess the impact of Basel III on banks� performance with the moderating role of managerial ownership by integrating Modigliani and Miller proposition and stakeholder theory. ROE and Tobin�s Q are used as proxy variables for measuring bank performance. The study is expected to help and assist policymakers, regulators, and managers in governing the framework which can enhance the overall performance of the banks. © 2022, The Author(s), under exclusive license to Springer Nature Switzerland AG.