As international financial markets have become more complex, so has the regulatory system which oversees them. The Basel Committee is just one of a plethora of international bodies and groupings which now set standards for financial activity around the world, in the interests of protecting savers and investors and maintaining financial stability. These groupings, and their decisions, have a major impact on markets in developed and developing countries, and on competition between financial firms. Yet their workings are shrouded in mystery, and their legitimacy is uncertain. Here, for the first time, two men who have worked within the system describe its origins and development in clear and accessible terms. Howard Davies was the first Chairman of the UK's Financial Services Authority, the single regulator for the whole of Britain's financial sector. David Green was Head of International Policy at the FSA, after spending thirty years in the Bank of England, and has been closely associated with the development of the current European regulatory arrangements. Now with a revised and updated introduction, which catalogues the changes made since the credit crisis erupted, this guide to the international system will be invaluable for regulators, financial market practitioners and for students of the global financial system, wherever they are located. The book shows how the system has been challenged by new financial instruments and by new types of institutions such as hedge funds and private equity. Furthermore, the growth in importance of major developing countries, who were excluded for far too long from the key decision-making for a has led to a major overhaul. The guide is essential reading for all those interested in the development of financial markets and the way they are regulated. The revised version is only available in paperback.

The Financial Crisis was a cross-sector crisis that fundamentally affected modern society. Regulation, as a concept, was both blamed for allowing the crisis to happen, but also tasked with developing and implementing solutions in the wake of the crash. In this book, a number of specialists from a range of fields have contributed their insights into the effect of the Financial Crisis upon the regulatory frameworks affecting their fields, how regulators have responded to the Crisis, and then what this may mean for the future of regulation within those industries. These analyses are joined by a picture of past financial crises – which reveals interesting patterns – and then analyses of architectural regulatory models that were fundamentally affected by the Crisis. The book aims to allow sector specialists the freedom to share their insights so that, potentially, a broader picture can be identified. Providing an interesting and thought-provoking account of this societally impactful era, this book will help the reader develop a more informed understanding of the potential future of financial regulation. The book will be of value to researchers, students, advanced level students, regulators, and policymakers.

Taking stock of the 2008 global financial crisis, this book provides 'outside the box' solutions for reforming international financial regulation.

Analyses governance structures for international finance, evaluates current regulatory reforms and proposes a new governance system for global financial markets.

“This publication could not be more timely. Little more than a decade after the global financial crisis of 2008, governments are once again loosening the reins over financial markets. The authors of this volume explain why that is a mistake and could invite yet another major crisis.” —Benjamin Cohen, University of California, Santa Barbara, USA “Leading political scientists from several generations here offer historical depth, as well as sensible suggestions about what reforms are needed now.” —John Kirton, University of Toronto, Canada, and Co-founder of the G7 Research Group “A valuable antidote to complacency for policy-makers, scholars and students.” —Timothy J. Sinclair, University of Warwick, UK This book examines the long-term, previously underappreciated breakdowns in financial regulation that fed into the 2008 global financial crash. While most related literature focuses on short-term factors such as the housing bubble, low interest rates, the breakdown of credit rating services and the emergence of new financial instruments, the authors of this volume contend that the larger trends in finance which continue today are most relevant to understanding the crash. Their analysis focuses on regulatory capture, moral hazard and the reflexive challenges of regulatory intervention in order to demonstrate that financial regulation suffers from long-standing, unaddressed and fundamental weaknesses.

Examining the subject from a holistic and multidisciplinary perspective, Principles of Financial Regulation considers the underlying policies and the objectives of financial regulation.

Over a decade has passed since the collapse of the U.S. investment bank, Lehman Brothers, marked the onset of the largest global economic crisis since the Great Depression. The crisis revealed major shortcomings in market discipline, regulation and supervision, and reopened important policy debates on financial regulation. Since the onset of the crisis, emphasis has been placed on better regulation of banking systems and on enhancing the tools available to supervisory agencies to oversee banks and intervene speedily in case of distress. Drawing on ten years of data and analysis, Global Financial Development Report 2019/2020 provides evidence on the regulatory remedies adopted to prevent future financial troubles, and sheds light on important policy concerns. To what extent are regulatory reforms designed with high-income countries in mind appropriate for developing countries? What has been the impact of reforms on market discipline and bank capital? How should countries balance the political and social demands for a safety net for users of the financial system with potentially severe moral hazard consequences? Are higher capital requirements damaging to the flow of credit? How should capital regulation be designed to improve stability and access? The report provides a synthesis of what we know, as well as areas where more evidence is still needed. Global Financial Development Report 2019/2020 is the fifth in a World Bank series. The accompanying website tracks financial systems in more than 200 economies before, during, and after the global financial crisis (http://www.worldbank.org/en/publication/gfdr) and provides information on how banking systems are regulated and supervised around the world (http://www.worldbank.org/en/research/brief/BRSS).

The book sets forth the economic rationale for international financial regulation and what role, if any, international regulation can play in effectively managing systemic risk while providing accountability to all affected nations. The book suggests that a particular type of global governance structure is necessary to have more efficient regulation of the international financial system.

It is often argued that international financial regulation has been substantially strengthened over the past decades through the international harmonization of financial regulation. There are, however, still frequent outbreaks of painful financial crises, including the recent 2008 global financial crisis. This raises doubts about the conventional claims of the strengthening of international financial regulation. This book provides an in-depth political economy study of the adoptions in Japan, Korea and Taiwan of the 1988 Basel Capital Accord, the now so-called Basel I, which has been at the center of international banking regulation over the past three decades, highlighting the domestic politics surrounding it. The book illustrates that, despite banks’ formal compliance with the Accord in these countries, their compliance was often cosmetic due to extensive regulatory forbearance that allowed their real capital soundness to weaken. Domestic politics thus ultimately determined national implementations of the Accord. This book provides its novel innovative study of the Accord through scores of interviews with bank regulators and analysis of various primary documents. It suggests that the actual effectiveness of international financial regulation relies ultimately on the domestic politics surrounding it. It implies as well that the past trend of international harmonization of financial regulation may be illusory, to at least some extent, in terms of its actual effectiveness. This book may interest not only political economists but also scholars working on the intersection of law, economics and institutions.

Examines the law and policy of financial regulation using a combination of conceptual analysis and strong empirical research.