A Comparative Assessment on the Role of Central Bank in a Wholesale Banking System

2019 ◽  
Vol 21 (1) ◽  
pp. 217-236
Author(s):  
Byeong-Ryul Lee
Keyword(s):  
Central Bank ◽  
Banking System ◽  
Comparative Assessment

scholarly journals THE ROLE OF THE CENTRAL BANK IN THE FUNCTION OF IMPROVEMENT OF LIQUIDITY OF BANKING SECTOR IN BOSNIA AND HERZEGOVINA

2019 ◽  
Vol 12 (24) ◽  
Author(s):  
Goran Mitrović ◽  
Živko Erceg
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Bosnia And Herzegovina ◽  
Banking Sector ◽  
Banking System ◽  
Policy Instruments ◽  
Foreign Banks ◽  
Dayton Agreement ◽  
The Impact

The monetary policy of Bosnia andHerzegovina is rather limited because it is basedon the principles of a currency boardcharacterized by the impossibility of implementingthe basic monetary policy instruments incomparison with the monetary policy of theEuropean Union. However, the constant presenceof European integrations should point the need fora more drastic change in the monetary policy ofBosnia and Herzegovina. By entering theEuropean Monetary Union (EMU), the monetaryterritory of Bosnia and Herzegovina will becomeone of the branches of the European Central Bank(ECB). In addition, it is not difficult to concludewhy the Law about the Central Bank of Bosnia andHerzegovina has been adopted with the first lawsof the Dayton Agreement, if it is known that thelargest part of the banking system, and thereforethe financial market, is owned by foreign banks.This work will point out the significance of theCentral Bank of Bosnia and Herzegovina, as oneof the most important factors for maintaining thepermanent liquidity of the banking sector inBosnia and Herzegovina. The possibilities andlimitations of the Central Bank of Bosnia andHerzegovina will be determined, with theassumption of macroeconomic sustainability overa longer period of time. The need of reforming thebanking system in Bosnia and Herzegovina will beanalyzed through the constant implementation ofthe Basel standards with the increasingparticipation of foreign banks in the Bosnia andHerzegovina. It will be determined the impact ofthe implementation of the Basel III in the bankingindustry in Bosnia and Herzegovina and itsconsequences on the banking and economicsystem.models, on the ways of financing theelimination of adverse consequences of naturaldisasters.

scholarly journals Central Banks

2021 ◽  
pp. 11-28
Author(s):  
Ulrich Bindseil ◽  
Alessio Fotia
Keyword(s):  
Central Bank ◽  
Commercial Banks ◽  
Balance Sheet ◽  
Banking System ◽  
Central Banks ◽  
Reserve Requirement ◽  
Money Creation ◽  
Reserve Banking ◽  
Bank Money

AbstractThis chapter develops further the role of a central bank and its interplay with commercial banks. Together, the two ensure the provision of liquidity to the economy, such that the real sectors are shielded from flows of funds originating from household and investors. We also disaggregate the banking system into two banks to represent deposit flows between banks and their impact on the central bank’s balance sheet, and to distinguish between what we call “relative” and “absolute” central bank intermediation. We then integrate deposit money creation by commercial banks into our system of financial accounts, and revisit some old debates, such as the limits of bank money creation and the role of related parameters that the central bank can set (not only the reserve requirement ratio, but also the collateral framework). Finally, we explain the concepts of “plain money” and “full reserve banking” within the financial accounts, and also discuss in this framework the recent proposals regarding central bank digital currency (CBDC).

LIQUIDITY, INTERBANK MARKET, AND THE SUPERVISORY ROLE OF THE CENTRAL BANK

2003 ◽  
Vol 7 (2) ◽  
pp. 192-211 ◽  
Author(s):  
Young Sik Kim
Keyword(s):  
Central Bank ◽  
Banking System ◽  
Central Banking ◽  
Bank Loans ◽  
Interbank Market ◽  
Monitoring Cost ◽  
Delegated Monitoring ◽  
The Individual ◽  
Cash Reserves

This paper provides an explanation for the supervisory role of the central bank in a monetary general equilibrium model of bank liquidity provision. Under incomplete information on the individual banks' liquidity needs, individual banks find it optimal to invest solely in bank loans holding no cash reserves, and rely on the interbank market for their withdrawal demands. Using the costly state verification approach under uncertainty in aggregate liquidity demands, the supervisory role of the central bank as a large intermediary arises as an incentive-compatible arrangement by which banks hold the correct level of cash reserves. First, it takes up a delegated monitoring role for the banking system. Second, it engages in discount-window lending at a penalty rate, where the discount margin covers exactly the monitoring cost incurred. Finally, under the central banking mechanism, currency premium no longer exists in the sense that currency is worth the same as deposits having an equal face value.

scholarly journals Polityka pieniężna Narodowego Banku Polskiego od roku 1989

2015 ◽  
pp. 173-192
Author(s):  
Paweł Franka ◽  
Anna Wisz
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Exchange Rates ◽  
Inflation Targeting ◽  
Banking System ◽  
Policy Instruments ◽  
Open Market ◽  
The Past ◽  
National Bank

The article discusses the activities of National Bank of Poland during the past twenty-five year and more specifically in the years 1989–2013 with particular emphasis on monetary policy. During this time, the Polish central bank has undergone fundamental change, starting from the position of the so-called monobank, i.e. bank without autonomy in activities, characteristic of planned economy. The article describes the process of transformation of the National Bank of Poland to the role of a central bank operating in a market economy. The paper emphasizes all the important events in the transformation, including building of a two-tier banking system, the gradual replacement of the administrative measures by monetary policy instruments, currency denomination, constitutional guarantees of the role and independence of the National Bank of Poland, creation of the Monetary Policy Council – a departure from the single monetary policy-making in favor of collegiality, changing the monetary policy strategy to direct inflation targeting, bank exchange rates policy, open market operations.

scholarly journals Theoretical aspects of mechanism of interaction between money and credit

2019 ◽  
Vol 2019 (4) ◽  
pp. 83-93
Author(s):  
Oleg Usherovich Avis
Keyword(s):  
Monetary Policy ◽  
Central Bank ◽  
Commercial Banks ◽  
Banking System ◽  
Financial System ◽  
Bank Lending ◽  
National Bank ◽  
Weak Points ◽  
The Stability

The paper describes the central bank monetary policy that has been heavily criticized, largely due to the banks’ inability to identify emerging risks in a timely manner and to prevent threats to the stability of the entire global financial and banking system. A more rigorous expert-theoretical and public assessment is typical for analyzing the role of commercial banks in these processes, whereby they are recognized as the main culprits of recurrent crises. The excursion into the evolution of theoretical views on the problem under study allows to conclude that it is related to the credit nature of money, in which the activities of commercial banks are of great importance. This idea was shared by many foreign and Russian scientists, who at one time offered their recipes for improving the monetary mechanism, but remained not taken into account in practice. The initial positions of bank lending processes and money making on their basis in volumes and quality, often unregulated, have been analyzed. Much attention is paid to the role of the Central Bank, the bank customers and the state in shaping the credit nature of money. As an alternative to modern methods of monetary regulation, the idea of full-value money has been described. As an example, the phenomenon of the Swiss full-value money initiative in 2018 has been given. It is noted that the initiative demanded to ban issuing electronic (non-cash) money from the commercial banks in order to stabilize the financial system. The weak points of the reform include a threat to the stability of the money value, the low degree of independence of the National Bank of Switzerland. It has been inferred that the events taking place in the modern financial system may indicate significant transformations of the design and toolkit of the modern monetary policy

scholarly journals Stabilność i bezpieczeństwo systemu bankowego - aspekty instytucjonalne i operacyjne

2017 ◽  
pp. 121-142
Author(s):  
Bogusław Pietrzak ◽  
Katarzyna Wasiak
Keyword(s):  
Central Bank ◽  
Commercial Banks ◽  
Banking System ◽  
Safety Net ◽  
Operational Conditions ◽  
Banking Institutions ◽  
The Stability ◽  
Conditions Of Stability ◽  
Financial Safety Net

This article attempts to systematize the institutional and operational conditions of stability and security of the banking system. The intention of the authors is to analyse some factors strongly affecting the functions and principles of two members of modern banking systems - the central bank and commercial banks. The authors start the analyses by defining stability and security of the banking system. Then point out to the role of the various segments of the financial safety net in providing conditions for stable and secure system, and determine the necessary requirements of the stabilization as demanded from the banking institutions management system. In conclusion, they define the set of requirements (institutional and operational) necessary for achieving the stability and security of the banking system

scholarly journals AN OVERVIEW OF THE BANKING SYSTEM IN SYRIA AFTER A DECADE OF UNREST

2020 ◽  
Vol 5 (19) ◽  
pp. 68-84
Author(s):  
Omar Farouk Al Mashhour ◽  
Muhammad Imam Asalie ◽  
Ahmad Shamsul Abd Aziz ◽  
Nor Azlina Mohd Noor
Keyword(s):  
Law Enforcement ◽  
Middle East ◽  
Central Bank ◽  
Banking Sector ◽  
Banking Industry ◽  
Banking System ◽  
Annual Reports ◽  
Banking Systems ◽  
Comprehensive View

After a decade of crippling international sanctions and devastating conflict, the Syrian economy has been largely in shambles. Nevertheless, the Syrian banking industry has largely weathered the storm. This article attempts to illustrate a comprehensive view of the banking sector in Syria and how well has one of the oldest banking systems in the middle east fared over the years and how has it survived the seemingly insurmountable challenges. Additionally, The article targets to show the role of the central bank of Syria in supervising the banking industry as well as a view on the recent development of the legal and financial orientation. The researchers have faced issues related to the absence of information due to its limits on what the central bank is publishing. Also, it is found that lack of English annual reports and missing reports for some years, will lower the chances of attracting investors. The article suggested a set of recommendations that may elevate the condition of the Syrian banking system by issuing a new law enforcement division to track down any unlawful activities.

Arah Kebijakan Pengawasan terhadap Perbankan Syariah dalam Sistem Perbankan Nasional di Indonesia

2020 ◽  
Vol 3 (1) ◽  
pp. 41-52
Author(s):  
Andrew Shandy Utama
Keyword(s):  
Central Bank ◽  
Financial Services ◽  
Banking System ◽  
Islamic Banking ◽  
Legal Research ◽  
Islamic Bank ◽  
Independent Direction ◽  
National Banking System

This research aims to explain the direction of policy regarding supervision of Islamic banking in the banking system in Indonesia. The method used in this research is normative legal research using the statutory approach. The results of this research explain that the policy regarding supervision of Islamic banking in the national banking system in Indonesia is headed toward an independent direction. In Law Number 7 of 1992 and Law Number 10 of 1998, it is stated that supervision of Islamic banking is done by Bank Indonesia as the central bank. Based on Law Number 21 of 2008, supervision of Islamic banking is strengthened by not only being supervised by Bank Indonesia, but also by the National Sharia Council of the Majelis Ulama Indonesia by placing Sharia Supervisory Councils in each Islamic bank. After the ratification of Law Number 21 of 2011, supervision of Islamic banking moved from Bank Indonesia to an independent institution called the Financial Services Authority.

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