Accounting for Financial Stability: Bank Disclosure and Loss Recognition in the Financial Crisis

Barely two decades after the Asian financial crisis Asia was suddenly confronted with multiple challenges originating outside the region: the 2008 global financial crisis, the European debt crisis, and, finally developed economies’ implementation of unconventional monetary policies. Especially the implementation of quantitative easing (QE), ultra-low interest rate policies, and negative interest rate policies by a number of large central banks has given rise to concerns over financial stability and international capital flows. One of the regions most profoundly affected by the crisis was Asia due to its high dependence on international trade and international financial linkages. The objective of this book is to explain how macroeconomic shocks stemming from the global financial crisis and recent unconventional monetary policies in developed economies have affected macroeconomic and financial stability in emerging markets, with a particular focus on Asia. In particular, the book covers the following thematic areas: (i) the spillover effects of macroeconomic shocks on financial markets and flows in emerging economies; (ii) the impact of recent macroeconomic shocks on real economies in emerging markets; and (iii) key challenges for the monetary, exchange rate, trade, and macroprudential policies of developing economies, especially Asian economies, and suggestions and recommendations to increase resiliency against external shocks.

Values-Based and Global Systemically Important Banks: Their Stability and the Impact of Regulatory Changes After the Financial Crisis on it

Asia-Pacific Financial Markets ◽

10.1007/s10690-021-09332-w ◽

2021 ◽

Author(s):

Theresa Schäfer ◽

Sebastian Utz

Keyword(s):

Financial Crisis ◽

Financial Stability ◽

Social Impact ◽

Bank Stability ◽

Regulatory Changes ◽

The Difference ◽

The Impact ◽

Systemically Important Banks

AbstractWe study the financial stability of Values-Based Banks (VBBs) and Global Systemically Important Banks (GSIBs), and how regulatory changes in the aftermath of the financial crisis affected bank stability. These two types of banks allow contrasting an environmental and social impact banking approach to a conventional one. VBBs exhibit significantly higher financial stability before and during the financial crisis. However, regulatory changes in the aftermath of the financial crisis requiring higher capital buffer, have significantly affected GSIBs and rendered the difference in stability levels insignificant.

Multinational Banking in Europe: Financial Stability and Regulatory Implications - Lessons from the Financial Crisis

SSRN Electronic Journal ◽

10.2139/ssrn.1803405 ◽

2010 ◽

Cited By ~ 1

Author(s):

Giorgio Barba Navaretti ◽

Giacomo Calzolari ◽

Micol Levi ◽

Alberto F. Pozzolo

Keyword(s):

Financial Crisis ◽

Financial Stability ◽

Multinational Banking

Financial Sector Liberalization and Financial Instability: Case of Selected Southern African Development Community Member Countries

Journal of Economics and Behavioral Studies ◽

10.22610/jebs.v10i6(j).2593 ◽

2018 ◽

Vol 10 (6(J)) ◽

pp. 42-49

Author(s):

Nolungelo Cele ◽

Kapingura FM

Keyword(s):

Financial Crisis ◽

Financial Stability ◽

Financial Liberalization ◽

Financial Sector ◽

Financial Instability ◽

Domestic Economy ◽

Financial Reforms ◽

Empirical Results ◽

The Face ◽

Almost All

The importance of financial liberalization is well documented in the literature. However, there has been an emergency of studies, which indicate that this can be another channel through which financial instability is generated in the domestic economy. Utilising data from four SADC countries, the empirical findings show that financial reforms are positively related to financial instability in almost all the specifications. The empirical results further revealed that financial instability intensifies in the face of a financial crisis. The result suggests that financial liberalization can therefore be another source of financial instability in the region. The empirical results imply that though policymakers should liberalise the financial system, policies aimed at maintaining financial stability should also be promoted.

INTERNATIONAL STANDARDS FOR BANK CAPITAL REGULATION

Financial and credit activity problems of theory and practice ◽

10.18371/fcaptp.v1i36.227609 ◽

2021 ◽

Vol 1 (36) ◽

pp. 35-45

Author(s):

V. Kovalenko ◽

S. Sheludko ◽

N. Radova ◽

F. Murshudli ◽

K. Gonchar

Keyword(s):

Financial Crisis ◽

Economic Crisis ◽

Financial Stability ◽

International Standards ◽

Capital Adequacy ◽

Capital Regulation ◽

Bank Capital ◽

Banking Supervision ◽

New Paradigm ◽

Bank Capital Regulation

The paper analyzes the evolution of the introduction of international standards for bank capital regulation. The aim of the research is to study international standards for bank capital regulation and their impact on financial stability and sustainability of domestic banking systems. The 2007—2009 Global Financial Crisis was perhaps the greatest banking and financial crisis since bank failures and the financial panic of the Great Depression in early 1930s. According to academics and professionals, there has been much debate over the last decade as to whether the 2007—2009 banking crisis was primarily a solvency crisis or a liquidity crisis. Capital adequacy of banks today is the main indicator of increasing society’s confidence in banking systems. The flexible and balanced implementation of Basel Committee on Banking Supervision (BCBS) recommendations on the assessment of bank capital adequacy is of particular importance in the context of the deepening economic crisis caused by COVID-19 quarantine restrictions. Regulation of bank capital is primarily settles by the ability to execute basic functions inherent in it. A number of shocks in connection with the crisis require the renewal and search for a new paradigm of regulation, which today is focused on achieving financial stability, overcoming pro-cyclicality, especially in the banking sector. One of the latest developments in the field of bank capital regulation has been the implementation of international banking supervision standards recommended by BCBS, which have been transformed from Basel I, Basel II, Basel III, Basel 3.5 to Basel IV. The new ideology suggests that in times of financial and economic crisis or in anticipation of growing uncertainty in the economy, it is necessary to abandon the idea of bank capital management and the creation of financial reserves to maintain liquidity and stability of financial institutions. These measures will not be able to protect the bank from default and bankruptcy. This ideology has become a new paradigm of effective banking regulation, which can be formulated as an accepted set of three vectors: risk; risk management; risk-oriented supervision.

Financial stability of Islamic banking and the global financial crisis: Evidence from the Gulf Cooperation Council

Economic Systems ◽

10.1016/j.ecosys.2017.09.001 ◽

2018 ◽

Vol 42 (2) ◽

pp. 346-360 ◽

Cited By ~ 24

Author(s):

Faisal Alqahtani ◽

David G. Mayes

Keyword(s):

Financial Crisis ◽

Financial Stability ◽

Global Financial Crisis ◽

Gulf Cooperation Council ◽

Islamic Banking ◽

The Global Financial Crisis

Insurer of Last Resort: Singapore’s Government Investment Corporation

Sovereign Wealth Funds ◽

10.23943/princeton/9780691142296.003.0006 ◽

2013 ◽

Author(s):

Gordon L. Clark ◽

Adam D. Dixon ◽

Ashby H. B. Monk

Keyword(s):

Financial Crisis ◽

Financial Stability ◽

Best Practice ◽

East Asian ◽

Political Elite ◽

Government Investment ◽

Sovereign Wealth Funds ◽

Nation States ◽

The Government ◽

Fund Governance

During the financial crisis, a number of East Asian sovereign wealth funds (SWFs) acted as insurers of last resort for their nation-states, underwriting financial stability and social welfare. This chapter explains how and why this role came to pass, arguing that it serves to sustain the legitimacy of the nation-state as well as justify the separation of SWF assets from the public interest in current consumption and spending. Focusing on the Government of Singapore Investment Corporation (GIC), it suggests that the prospect of recurrent financial crises was an important prompt for its establishment in 1981, reinforced by the experience of many East Asian countries in the 1997 Asian financial crisis. The chapter explains the formal constitution of the GIC, the mechanisms by which its reserves are returned to the government in crisis, and the role of different sections of the political elite in managing those assets. Referencing the principles of best-practice fund governance and the Santiago Principles underwriting the legitimacy of SWFs, it also considers the governance of the GIC, especially in regard to its investment processes.