Bank Supervision, Regulation and Efficiency:

If post-communist countries realized marketized bank–state ties through transition and international pressure to privatize their banks with foreign capital, western Eurozone states have more recently come under pressure to follow suit. European Banking Union centralized bank supervision and introduced a single resolution board at the expense of national authority. Thus under banking union, national regulatory and supervisory forbearance was curbed; barriers to banking market entry were no longer the purview of national authorities; disproportionate bank lending to one’s own sovereign would be discouraged; and bank bondholders, creditors and depositors—i.e. market actors—paid the price for bank failures first, before governments and taxpayers. While European Banking Union put the euro on stronger foundations, it also curbed national economic policy discretion and limited tools for adjustment. Taking Italy, Portugal, Spain and Germany as examples, this chapter explains why and in what policy areas Eurozone states’ sovereignty clashed with banking union.

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The Logic and Legitimacy of Bank Supervision: The Case of the Bank Holiday of 1933

The Business History Review ◽

10.1017/s0007680520000896 ◽

2021 ◽

pp. 1-34

Author(s):

Peter Conti-Brown ◽

Sean H. Vanatta

Keyword(s):

New Deal ◽

Economic History ◽

Banking System ◽

Economic Reforms ◽

Banking Crises ◽

Public Confidence ◽

Government Officials ◽

Bank Supervision ◽

Political Skills ◽

The U.S

The U.S. banking holiday of March 1933 was a pivotal event in twentieth-century political and economic history. After closing the nation's banks for nine days, the administration of newly inaugurated president Franklin D. Roosevelt restarted the banking system as the first step toward national recovery from the global Great Depression. In the conventional narrative, the holiday succeeded because Roosevelt used his political talents to restore public confidence in the nation's banks. However, such accounts say virtually nothing about what happened during the holiday itself. We reinterpret the banking crises of the 1930s and the 1933 holiday through the lens of bank supervision, the continuous oversight of commercial banks by government officials. Through the 1930s banking crises, federal supervisors identified troubled banks but could not act to close them. Roosevelt empowered supervisors to act decisively during the holiday. By closing some banks, supervisors made credible Roosevelt's claims that banks that reopened were sound. Thus, the union of FDR's political skills with the technical judgment of bank supervisors was the key to solving the banking crisis. Neither could stand alone, and both together were the vital precondition for further economic reforms—including devaluing the dollar—and, with them, Roosevelt's New Deal.

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Central bank digital currency: the future of institutional changes in the banking sector

Fìnansi Ukraïni ◽

10.33763/finukr2021.02.026 ◽

2021 ◽

Vol 2021 (2) ◽

pp. 26-48

Author(s):

Volodymyr MISHCHENKO ◽

◽

Svitlana NAUMENKOVA ◽

Svitlana MISHCHENKO ◽

◽

...

Keyword(s):

Central Bank ◽

Financial Stability ◽

Banking Sector ◽

Central Banks ◽

Credit System ◽

Bank Supervision ◽

Bank Of China ◽

Digital Currency ◽

Financial Monitoring ◽

The Impact

The purpose of the article is to reveal the essence and features of the introduction of digital currency of central banks and their impact on the conditions of monetary policy, financial stability, as well as institutional transformations in the development of national banking systems. The study is based on an analysis of projects of issuance and use of digital currencies of the ECB and central banks of leading countries, as well as the results of pilot projects of the National Bank of China on the use of the digital yuan and NBU on the e-hryvnia circulation. It is proved that digital currency of the central bank should be considered as a new dematerialized form of national currency in addition to cash and non-cash forms. Particular attention is paid to the study of the impact of the use of digital currency by central banks on the main parameters of economic policy. The main directions of potential influence of digital currency use on transformation of mechanisms of realization of monetary, budgetary and tax, macroprudential policy, maintenance of financial stability, activization of action of channels of the monetary transmission mechanism, and also on reforming of system of the state financial monitoring and bank supervision are substantiated. It is determined that one of the consequences of the use of digital currency will be the ability to ensure full control over all monetary transactions, which will help reduce the shadow economy and corruption. Structural and logical schemes of centralized and decentralized models of issuance and circulation of digital currency of central bank have been developed, directions of changes in the structure and functions of commercial and central banks, as well as in the structure of the financial and credit system in general have been substantiated.

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