Download or read book Supervisory Incentives in a Banking Union written by Elena Carletti and published by International Monetary Fund. This book was released on 2016-09-15 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt: We explore the behavior of supervisors when a centralized agency has full power over all decisions regarding banks, but relies on local supervisors to collect the information necessary to act. This institutional design entails a principal-agent problem between the central and local supervisors if their objective functions differ. Information collection may be inferior to that under fully independent local supervisors or under centralized information collection. And this may increase risk-taking by regulated banks. Yet, a “tougher” central supervisor may increase regulatory standards. Thus, the net effect of centralization on bank risk taking depends on the balance of these two effects.
Download or read book A Banking Union for the Euro Area written by Rishi Goyal and published by International Monetary Fund. This book was released on 2013-02-12 with total page 31 pages. Available in PDF, EPUB and Kindle. Book excerpt: The SDN elaborates the case for, and the design of, a banking union for the euro area. It discusses the benefits and costs of a banking union, presents a steady state view of the banking union, elaborates difficult transition issues, and briefly discusses broader EU issues. As such, it assesses current plans and provides advice. It is accompanied by three background technical notes that analyze in depth the various elements of the banking union: a single supervisory framework; a single resolution and common safety net; and urgent issues related to repair of weak banks in Europe.
Download or read book Optimal Supervisory Architecture and Financial Integration in a Banking Union written by Jean-Edouard Colliard and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Supervisory Incentives in a Banking Union written by Elena Carletti and published by International Monetary Fund. This book was released on 2016-09-21 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt: We explore the behavior of supervisors when a centralized agency has full power over all decisions regarding banks, but relies on local supervisors to collect the information necessary to act. This institutional design entails a principal-agent problem between the central and local supervisors if their objective functions differ. Information collection may be inferior to that under fully independent local supervisors or under centralized information collection. And this may increase risk-taking by regulated banks. Yet, a “tougher” central supervisor may increase regulatory standards. Thus, the net effect of centralization on bank risk taking depends on the balance of these two effects.
Download or read book Monitoring the Supervisors written by Jean-Edouard Colliard and published by . This book was released on 2014 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: I study the optimal architecture of bank supervision in a federal system. A central supervisor gets information about a bank, for instance through stress-testing, and decides whether an on-site examination should be performed by a local or a central authority. Local supervisors have lower inspection costs, but do not internalize cross-border externalities. The optimal degree of centralization depends on the severity of these externalities, the opacity of the supervised bank and the specificity of its assets. The market reacts to the chosen architecture, so that a centralized supervision endogenously increases market integration and cross-border externalities, strengthening the need for centralized supervision. The economy can be trapped in an equilibrium with low supervision and integration, while a forward-looking design of the supervisory architecture would coordinate economic agents on a superior equilibrium.
Download or read book Incentive Problems in Banking Supervision the European Case written by Martin Schüler and published by . This book was released on 2008 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper discusses the incentive conflicts that arise in banking supervision in the EU in a principal-agent framework, where the regulator is the agent and the taxpayers is the principal. The regulatory agent in addition to maintaining financial stability (the objective of the principal) may pursue private interests. Incomplete information, insufficient accountability of the agent and lack of enforceability of compliance result in an incentive problem. A reform of the European supervisory system complemented by strengthening market discipline based on improved disclosure of both the supervisor and the banks may help to solve the European incentive problem.
Download or read book Banking Union for Europe written by Thorsten Beck and published by . This book was released on 2012-10-01 with total page 152 pages. Available in PDF, EPUB and Kindle. Book excerpt: Contributions from Viral Acharya, Joshua Aizenman, Franklin Allen, Thorsten Beck, Erik Bergl f, Claudia Buch, Elena Carletti, Ralph de Haas, Luis Garicano, Andrew Gimber, Charles Goodhart, Vasso Ioannidou, Daniel Gros, Dirk Schoenmaker, Geoffrey Underhill, Wolf Wagner, Benjamin Weigert, Frank Westermann, Charles Wyplosz and Jeromin Zettelmeyer.
Download or read book The Single Supervisory Mechanism Or SSM Part One of the Banking Union written by Eddy Wymeersch and published by . This book was released on 2014 with total page 80 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Financial Supervision in Europe written by Jeroen J. M. Kremers and published by Edward Elgar Publishing. This book was released on 2003 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial Supervision in Europe discusses the implications of financial market integration for the structure of financial supervision in the European Union. It argues that, at present, negotiations on a European system of supervisors might lead to a compromise that may prove sub-optimal given the evolution of national supervisory models and international financial markets. As integration continues and the most appropriate national supervisory models emerge from a best practices approach, a reform of the organisational structure of supervision in Europe may become necessary. The contributors provide an overview of different arguments surrounding this discussion, and illustrate that several improvements to the present structure of supervision are possible. These include proposals to facilitate the evolution of national models, and concepts to strengthen co-ordination in supervision and in establishing clear procedures in crisis management. Detailing financial market developments in Europe and the US, the book questions the incentives for national supervisory authorities to monitor cross-border activities, to exchange information and to take into account the impact of their dealings with the financial systems of other countries. Classifying models for the organisational structure of financial supervision in Europe, this book will be of great interest to finance ministries, supervisory authorities, central banks and financial institutions. Students, lecturers and researchers of banking and finance will also find the book to be of importance.
Download or read book Common Banking Supervision in the Eurozone written by Guido Ferrarini and published by . This book was released on 2013 with total page 69 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper we analyse various instances of supervisory centralization either implemented or proposed in Europe in the aftermath of the financial crisis and the sovereign debt crisis. Our central thesis is that supervisory fragmentation is a cause of systemic risk, as cooperation amongst national authorities is bound to fail in crisis situations, while the absence of common resolution mechanisms and common deposit guarantee schemes aggravates the costs of a banking crisis and increases the chances of a bailout. We argue, in particular, that the current European supervisory architecture introduced in 2010 substantially belongs to the model of 'enhanced' cooperation, despite including elements of the other two models of supervisory centralization (lead supervisor and single supervisor), and is the outcome of a political compromise. Presently, European supervisory authorities, including EBA, coordinate the national ones, rather than supervising financial firms directly. National authorities cooperate in a network (the ESFS) under local mandates and are therefore prone to domestic biases, particularly in crisis situations.The situation will be different under the Banking Union when the Single Supervisory Mechanism (SSM) is in place. We argue, however, that the SSM includes elements of cooperation and delegation, which will help the ECB to perform its tasks as a central supervisor, but will also give rise to conflicts of interest and information asymmetries. Moreover, the SSM will be limited to the eurozone, so that the enhanced cooperation and lead supervisor's models will nevertheless apply in the relationships with other countries. The ECB will also have to cooperate with EBA that will keep its regulatory and mediation tasks, as already provided by the 2010 reforms. As a result, cross-border banking groups will often be subject to substantial supervisory fragmentation. The seriousness of these weaknesses could be tempered by an extension of the Banking Union to a sufficient number of non-euro countries under the regime of close cooperation. However, we show that the incentives for these countries to opt into a similar regime are modest and that there could be greater incentives to stay out of the SSM and exploit the voting power of non-euro countries within the EBA's Supervisory Board.
Download or read book International Convergence of Capital Measurement and Capital Standards written by and published by Lulu.com. This book was released on 2004 with total page 294 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Incongruent Incentives in Bank Supervision written by Danielle Rae Lewis and published by . This book was released on 1996 with total page 354 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Exploring Strategies of Supranational Influence in the Banking Union written by Jakub Gren and published by . This book was released on 2017 with total page 22 pages. Available in PDF, EPUB and Kindle. Book excerpt: The paper analyzes strategies of supranational administrative influence aiming to promote the compliance of national supervisory apparatus with the Union's policies on prudential supervision of credit institutions. It covers exclusively the SSM's Indirect Supervision regime which is perceived as an example of system of EU multilevel administration.
Download or read book From the Internal Market to a Banking Union written by Sachverständigenrat zur Begutachtung der Gesamtwirtschaftlichen Entwicklung and published by . This book was released on 2012 with total page 7 pages. Available in PDF, EPUB and Kindle. Book excerpt: The European sovereign debt crisis has revealed severe flaws in the design of the internal market. Both, private and public borrowers had incentives for excessive borrowing, which have been created by deficits in the regulatory structure of financial markets. Capital requirements for banks were too low and had procyclical effects (Favara and Ratnovski 2012). Supervision has been ineffective with regard to containing the build-up of risks in banks' balance sheets. Common monetary policy in the Euro Area has not been accompanied by the transfer of authority to supervise and restructure banks which has, in turn, created incentives to shift risks to the European level. Risks of banks and states have become dangerously intertwined. Proposals for a banking union aim at correcting these deficits. In principle, a banking union is a necessary complement to other elements of the internal market. In an integrated capital market, banking distress in one country can have negative externalities for the stability of financial systems in other countries. Such risks are even more pronounced if other countries are affected through a common monetary policy. The banking union currently being discussed has three elements (President of the European Council 2012): banking supervision at the European level, a European authority for bank restructuring and resolution financed by a bank resolution fund, and a European deposit insurance fund. So far, concrete proposals have been made for the establishment of a Single Supervisory Mechanism only. However, a banking union is a long-term project. It is not the key to a solution to the acute problems in Europe's banking sectors (Buch and Weigert 2012, GCEE 2012a).
Download or read book Prudential Supervision written by Frederic S. Mishkin and published by University of Chicago Press. This book was released on 2009-02-15 with total page 379 pages. Available in PDF, EPUB and Kindle. Book excerpt: Since banking systems play a crucial role in maintaining the overall health of the economy, the adverse effects of poorly supervised systems may be quite severe. Without some form of vigilant external oversight, banking systems could fall prey to excessive risk taking, moral hazard, and corruption. Prudential supervision provides that oversight, using government regulation and monitoring to ensure the soundness of the banking system and, by extension, the economy at large. The contributors to this thoughtful volume examine the current state of prudential supervision, focusing on fundamental issues and key pragmatic concerns. Why is prudential supervision so important? What kinds of excess must it guard against? What particular forms does it take? Which of these are the most effective deterrents against mismanagement and system overload in today's rapidly shifting financial climate? The contributors foresee a continued movement beyond simple regulatory rules in banking and toward a more active evaluation and supervision of a bank's risk management practices.
Download or read book The Origins History and Future of the Federal Reserve written by Michael D. Bordo and published by Cambridge University Press. This book was released on 2013-03-25 with total page 453 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book contains essays presented at a conference held in November 2010 to mark the centenary of the famous 1910 Jekyll Island meeting of leading American financiers and the US Treasury. The 1910 meeting resulted in the Aldrich Plan, a precursor to the Federal Reserve Act that was enacted by Congress in 1913. The 2010 conference, sponsored by the Federal Reserve Bank of Atlanta and Rutgers University, featured assessments of the Fed's near 100-year track record by prominent economic historians and macroeconomists. The final chapter of the book records a panel discussion of Fed policy making by the current and former senior Federal Reserve officials.
Download or read book Banking Union and Single Banking Supervisory Mechanism written by Nicolas Véron and published by . This book was released on 2012 with total page 70 pages. Available in PDF, EPUB and Kindle. Book excerpt: A major building block for the so called "banking union" is the banking supervision. The Euro Area Summit Statement from June 2012 classifies the provision of such a single supervisory mechanism 'as a matter of urgency'. On 12 September 2012 the Commission published a set of proposals for the establishment of a single supervisory mechanism. The notes in this compilation provide for a first evaluation of the Commissions proposals.
