To a question about the price of possible errors regulatory capital of banks
Judina Irina Nikolaevna
PhD, associate professor of the department "Finance and credit"
Russia, Financial University under the Government of the Russian Federation
The end of the financial crisis was followed by a number of studies analyzing its possible reasons. Among all those American scholars the most notable group of economists is the one that despite of the multitude of opinions blaming the vicious financial system deregulation and greedy bankers for such a disaster see the drawbacks of the financial regulation as the main cause. In particular, such drawbacks include the requirements to bank capital, both international (the Basel Committee) and national.
This article aims at showing the way the strengthened requirements to capital for commercial banks, observed at international and national levels, fail to manage risks and can even cause them. The comparative analysis of the negotiated agreements (from Basel I to Basel III) as well as the analysis of the USA bank capital assessment rules make us come to a conclusion that undeliberate mistakes in regulation practice can result in great consequences, such as systemic financial crises.
Basel Accords on the capital, approaches to the risk assessment, procyclicality effect, market discipline, moral hazard, market failure, asymmetric information on financial markets.
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