Does Regulatory Governance Matter for Financial System Stability? An Empirical Analysis

This article examines the implementation of the Twin Peaks model of financial system regulation in South Africa, the purpose of which is to create a financial system stability regulator, and a financial system consumer protection and market conduct regulator. It examines the historical development of Twin Peaks and its regulatory enforcement principles. It then analyses the similarities and differences between Twin Peaks in Australia (upon which the South African reforms are based) and South Africa. Finally the article provides concluding observations.

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Stock Market Prices and Financial System Stability

SSRN Electronic Journal ◽

10.2139/ssrn.3443372 ◽

2019 ◽

Author(s):

Zaäfri A. Husodo ◽

Muhammad Budi Prasetyo ◽

Rizky Luxianto ◽

Theresia Silitonga ◽

Januar Hafidz ◽

...

Keyword(s):

Stock Market ◽

Financial System ◽

System Stability ◽

Market Prices

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FINANCIAL SYSTEM RISKS

Vektor nauki Tol yattinskogo gosudarstvennogo universiteta Seriya Ekonomika i upravlenie ◽

10.18323/2221-5689-2021-1-13-21 ◽

2021 ◽

pp. 13-21

Author(s):

S. E. Demidova ◽

Keyword(s):

Public Finance ◽

Social Economic ◽

Financial System ◽

System Stability ◽

Theoretical Research ◽

Financial Risks ◽

The Public ◽

Systemic Risks ◽

The Social ◽

The Impact

Government interference in the social-economic processes through the implementation of anti-crisis measures and fiscal expansion holds the embodiment of financial risks for economic entities. As a result, government debt and budget gaps at the continuing drop of real disposable household income and companies’ profitability grow. Over a long-term horizon, the decisions made can cause a financial system misbalance and new risk generation, including systemic risks in the sphere of public finance. The author carries out the theoretical research of financial system risks, which can result in a decrease in the system stability in general. The study determines that there is no single theoretical concept of financial risks of the public sector. Within the research, the author analyzed the approaches to systemic risks in various economic sectors and decomposed systemic risk of the public finance sphere. The study specified global factors of influence on the financial system stability, determined the impact factors and common fiscal limitations considering the needs in the execution of state obligations. The pandemic factor – COVID-19 spread is highlighted as an exogenous factor of impact on the formation of financial system misbalances. The main threat to the financial system stability considered in terms of the functional-institutional approach is the deficiency of economic entities’ liquidity. Unprecedented budgetary measures of anti-crisis financial regulation, the deferred impact – tax preferences, and monetary measures had an immediate influence on the liquidity volume during the implementation of anti-COVID activities. Tools of budgetary monitoring, budget expenditures reviews, tax expenditures reviews, and budget consolidation ensure the budget mechanism flexibility. Factors producing financial system risks and the selected measures of state regulation will set the trends for the social-economic development of the country in the coming years.

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Luxembourg: Financial System Stability Assessment

IMF Staff Country Reports ◽

10.5089/9781484300374.002 ◽

2017 ◽

Vol 17 (122) ◽

pp. 1

Author(s):

International Monetary Fund.

Keyword(s):

Financial System ◽

System Stability ◽

Stability Assessment

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MANAKAH INDIKATOR TERPENTING STABILITAS SISTEM KEUANGAN?: PERSPEKTIF MAKROPRUDENSIAL

Jurnal Ekonomi Pembangunan ◽

10.14203/jep.27.1.2019.25-42 ◽

2019 ◽

Vol 27 (1) ◽

pp. 25-42

Author(s):

Aam Slamet Rusydiana ◽

Lina Nugraha Rani ◽

Fatin Fadilah Hasib

Keyword(s):

Financial Stability ◽

Inflation Rate ◽

Financial System ◽

Analytic Network Process ◽

System Stability ◽

Contagion Effect ◽

Macroprudential Policy ◽

Important Indicator ◽

Network Process ◽

Stability Measurement

In general there are two indicators of financial system stability, namely microprudential and macroprudential. Among macroprudential indicators are economic growth, balance of payments, inflation rate, interest and exchange rates, crisis contagion effect, and many others. Different from the previous researches concerning financial system stability measurement, this research will use the financial and banking practitioners’ perspective regarding the leading indicator in measuring financial system stability thus we can presumably determine the real leading financial stability indicator for the current situation using Analytic Network Process (ANP) method.The results show that based on the results of interviews with experts/banking practitioners, the 3 (three) most important aspects are the Debt aspect (0.225), Macro Indicator (0.222) and the Balance of Payment aspect (0.217). An important indicator of financial system stability from the next macroprudential aspect is related to Contagion Effect (0.178) and the last Aspect Labor (0.159). The Macroprudential Policy issued by Bank Indonesia as the central bank that has full authority, play an important role in maintaining Financial System Stability (SSK) in Indonesia.

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