...revenues and Value-at-Risk 7 Evaluation of Regulatory Challenges of UK Universal Banking Model 9 Micro and macro prudential regulation 9 Basel II, III regulation 10 Global Financial Crises in UK 12 Conclusion 13 References 14 Introduction The UK managing an account has experienced considerable change in the course of the most recent 20 years, essentially determined by local deregulation and different strengths that have changed supply and interest qualities of the money related administrations industry. Elaboration of structure and functioning of the UK banking industry, Evaluation of Regulatory Challenges of UK Universal Banking Model and Global Financial Crises in UK is discussed further in this paper. Structure and functioning of UK banking system: The UK banking system is regularly said to be very focused and subsequently deficiently aggressive. The UK banking sector contains one market and not many markets. The UK banking system is indeed a mix of numerous separate product markets with rivalry originating from distinctive regions and diverse contenders. The High Street banks are all sizeable members in each of the business sector fragments and giving administrations to the overall population, the leading bank in each one fragment has a tendency to appear as something else. Business banking framework included numerous high street banks give particular administrations to organizations. They work like common records, yet normally have more administrations...
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...Team n°4: FS5 Group 2 Regulation of Banking and Financial Market January 16th, 2013 ISEG BANK is a new French credit institution authorized in France by the Autorité de Contrôle Prudentiel - ACP -. The bank wishes to provide both French and European clients with investment services.Please advise on : 1. What are the applicable prudential rules in providing investment services across the European Economic Area ? 2. What are the conduct of business rules to be observed in relation to client protection.Make sure your answer are accurate from a regulotary perspective | I What are the applicable prudential rules in providing investment services across the European Economic Area ? As stated in the topic sentence, the credit institution that represents the ISEG Bank (IB) is under the control of the ACP (Prudential supervisory authority) which is chaired by the Governor of the France Bank. The ACP main missions are: * Contribution to the stability of the financial sector * The protection of investors * Strengthening the influence of France on the European and international scene IB wants to provide investment services to investors in France and Europe, so we will look for areas of application that represents the European Economic Area. The directive 2006/48/EC of the European Parliament and of the Council of 14 June 2006 is about the applicable prudential rules to credit institutions as discussed here, but also the rules governing their activities...
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...Article The Effects of Bank Regulation on the Relationship Between Capital and Risk ALESSANDRA TANDA Department of Economics, Management and Quantitative Methods, Università degli Studi di Milano, Via Conservatorio, 7, Milan 20122, Italy. E-mail: alessandra.tanda@unimi.it Capital regulation acts as an external force in the determination of bank capital and risk levels. Changes in the regulatory framework can influence banks’ decisions. Starting from the debate of the prudential regulation after the financial crisis, this paper reviews the main empirical contributions on the role of capital regulation in the determination of banks’ capital ratios and risk exposure to evaluate bank behavior. Capital and risk decisions seem to be effectively influenced by regulation, although results may vary according to factors such as time period, country, and the type of capital analyzed. Comparative Economic Studies (2015) 57, 31–54. doi:10.1057/ces.2014.35; published online 22 January 2015 Keywords: bank regulation, capital, Basel, risk, literature review JEL Classification: G2 INTRODUCTION The latest financial crisis has highlighted how bank capital regulation is necessary for the stability of the financial system. But also, it appears that it is not sufficient to ensure that banks’ decisions, in terms of risk and capital, are consistent with the aims of regulation. Regulation acts as an external force in the capital optimization process as banks set simultaneously the...
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...COMMERCIAL BANKS AND NEW CAPITAL REGULATION MAF 202 Prepared By: Simardeep Sran - 211689444 Due: September 12, 2013 Table of Contents 1. Introduction 4 2. Findings 5 3.1. Move from Basel II to Basel III 5 3.2.1. The Global Financial Crisis and Basel II Shortcomings 5 3.2. Basel III 6 3.3.2. Main Features 6 3.3.3. Basel II and Basel III Difference 8 3.3. Implications of Basel III 9 3.4.4. Global Banking System 9 3.4.5. Banking System in Australia 9 3.4.6. Banking System in Japan 10 3. Conclusions 11 4. Reference List 12 1. Introduction The financial system is beyond indispensable in the global economy, with commercial banks playing a vital role as the main form of a financial institution. Within the financial system it is crucial to have regulations and guidelines for financial institutions...
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... The role of NBFCs as effective financial intermediaries has been well recognised as they have inherent ability to take quicker decisions, assume greater risks, and customise their services and charges more according to the needs of the clients. While these features, as compared to the banks, have contributed to the proliferation of NBFCs, their flexible structures allow them to unbundle services provided by banks and market the components on a competitive basis. The distinction between banks and non-banks has been gradually getting blurred since both the segments of the financial system engage themselves in many similar types of activities. At present, NBFCs in India have become prominent in a wide range of activities like hire-purchase finance, equipment lease finance, loans, investments, etc. By employing innovative marketing strategies and devising tailor-made products, NBFCs have also been able to build up a clientele base among the depositors, mop up public savings and command large resources as reflected in the growth of their deposits from public, shareholders, directors and other companies, and borrowings by issue of non-convertible debentures, etc. Consequently, the share of non-bank deposits in household sector savings in financial assets, increased from 3.1 per cent in 1980-81 to 10.6 per cent in 199596. In 1998, the definition of public deposits was for the first time contemplated as distinct from regulated deposits and as such, the figures thereafter are not comparable...
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...Industry: Depository Institutions Overview • In this chapter, we explore two major depository institution (DI) groups: – Banks, and – Non-bank depository institutions. • We focus on the major characteristics of each group: – Size, structure and composition of industry group, – Balance sheets and recent trends, – Regulation. • In Australia, the Australian Prudential Regulation Authority (APRA) authorises financial institutions to carry out financial intermediation. Copyright 2007 McGraw-Hill Australia Pty Ltd PPTs t/a Financial Institutions Management 2e, by Lange, Saunders, Anderson ,Thomson and Cornett Slides prepared by Maike Sundmacher 1-2 Products Sold by the Financial Services Industry • Comparing the products of DIs in 1950 and 2006: – Much greater distinction between types of DIs in terms of products in 1950 than in 2006. – Blurring of product lines and services over time. – Wider array of services offered by all DI types. – Refer to Tables 1.1A and 1.1B in the text. Copyright 2007 McGraw-Hill Australia Pty Ltd PPTs t/a Financial Institutions Management 2e, by Lange, Saunders, Anderson ,Thomson and Cornett Slides prepared by Maike Sundmacher 1-3 Banks • Banks are the largest depository institutions in terms of size. • Major difference between banks and credit unions/savings institutions: banks have more varied assets and liabilities. • Differences in operating characteristics and profitability across size classes –...
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...Accounting Review, 2010 We appreciate comments from seminar participants at the Bank of Spain, Rob Bloomfield, Elicia Cowins, Hilary Eastman, Gavin Francis, Christian Kusi-Yeboah, Jim Leisenring, Martien Lubberink, Richard Rendleman, David Tweedie, and an anonymous reviewer. We acknowledge funding from the Center for Finance and Accounting Research at UNC-Chapel Hill and the Stanford Graduate School of Business Center for Global Business and the Economy. Electronic copy available at: http://ssrn.com/abstract=1601519 How did Financial Reporting Contribute to the Financial Crisis? Abstract We scrutinize the role financial reporting for fair values, asset securitizations, derivatives, and loan loss provisioning played in the Financial Crisis. Because banks were at the center of the Financial Crisis, we focus our discussion and analysis on the effects of financial reporting by banks. We conclude fair value accounting played little or no role in the Financial Crisis. However, transparency of information associated with asset securitizations and derivatives likely was insufficient for investors to assess properly the values and riskiness of bank assets and liabilities. Although the FASB and IASB have taken laudable steps to improve disclosures relating to asset securitizations, in our view, the approach for accounting for securitizations in the IASB’s Exposure Draft that would require banks to recognize whatever assets and liabilities they have after the securitization is...
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...all of these areas. The information has been gathered from the British Virgin Islands jurisdiction from sources such as Financial Services Commission, British Virgin Islands Government and internationally, from the International Monetary Fund, the Organization for Economic Co-operation and Development and the text, International Compliance Training Ltd. The research is basically theoretically driven to ascertain if the industry would be better off with regulation or left for participants to operate freely. Introduction: Scandals (such as Enron, WorldCom), the September 11 attack and financial crisis of 2007 and 2008 brought attention to loopholes of legislation that market participants have been taking advantage of for years. It was never the intention of regulation to cause market abuse, insider dealings or loss of investments or tangible properties. This paper details the shortcoming of legislation but also highlights how an effective regulatory environment can be achieved. What is Regulation? Regulation is defined according to the International Compliance Training Ltd as a set of binding rules by a public or private body with the necessary authority to supervise compliance and apply sanctions, penalties etc. for non-compliance (International Compliance Training, 2015). All financial services industry operates within a regulatory environment at many different levels. Different countries maintain their own financial services industries, for example in the...
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...opportunity, and reducing poverty. Getting the financial systems of developing countries to function more effectively in providing the full range of financial services is thus a task that will be well rewarded with economic growth. This report takes a first look at the overall financial system of Iraq with a forward looking approach. At the outset it was agreed with Iraqi authorities that the focus of this review should be forward looking and constructive. Overall the financial sector in Iraq is underdeveloped, and is playing a limited role in financial intermediation. The banking system is still by far the most important part of the Iraqi financial system, accounting for more than 75 percent of the assets and dominated by state ownership. Non-bank financial institutions and markets are small and under-developed but have the potential to provide access to sources of finance. Access to finance is impeded by weak financial infrastructure, which needs to be strengthened over time in all areas, including credit registry, the collateral framework, judicial systems, and accounting and auditing skills. When looking at Iraq’s financial system it is important to keep the general political economy in xv REPUBLIC OF IRAQ FINANCIAL SECTOR REVIEW mind. The difficult security situation imposes costs and constraints, the complex political situation impedes decisive policy action, governance issues linger, and the legacy of...
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...and liberalisation, financial stability issues have come to the forefront. These issues have ranged from discussions on basic issues of the definition of financial stability itself to issues of measurement, issues of choice of instruments to achieve the objective of financial stability and even issues on the degree of activism that central banks should adopt in pursuing this objective. 3. Traditionally, it has been believed that monetary stability leads to financial stability. However, as the events of the 1990s show, it need not necessarily be the case. While there are complementarities between these two objectives, especially in the long run, the same need not hold in the short-run. A stable macroeconomic environment - low and stable inflation, sustained growth and low interest rates - can generate excessive optimism about the future economic prospects and often the risks are downplayed. Accordingly, episodes of financial instability often have their origins in environment of macroeconomic stability. Thus, macro economic stability need not necessarily always place an economy in financial stability in the medium/long term and central banks, therefore, now bestow a...
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...Post Crises reforms and regulations The global financial crises displayed various weaknesses in the financial system. Ever since the crises, there have been sincere efforts in trying to eliminate or reduce the chances and impact of a future crisis. Four main areas of reform were identified by the international policy makers and sufficient work has been done to implement them (The Regulatory Response to the Global Financial Crises, 2014). Although Australia has not been affected as much as the north Atlantic countries, it still operates in the global environment. A part of regulatory reforms includes managing and monitoring systemic risk. Australia has been trying to do that through various entities such as the RBA, APRA and ASIC. Australia has also implemented reforms related to derivative trading, which are being traded more and more despite their high level of risk. Even though the reforms and regulations that were and going to be implemented, improved the safety of the financial system, there will never be a one hundred percent guarantee that there will be no future crisis. The G20 summit in 2008 was different from the prior summits in that it constituted of the leaders of the countries instead of Finance Ministers and Bank Governors (RBA, 2012). The leaders agreed on four areas of reforms which are: Strengthening Prudential Regulatory Standards (Basel III), addressing too big to fail institutions, reforms to OTC derivatives market and shadow banking. The entities...
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...also becoming increasingly important, as the Company evolves and changes, that new recruits show a willingness to learn, adaptability and ability to work as part of a team. The Recruitment & Selection procedure ensures that these criteria are addressed In this project I have studied Recruitment and Selection process of ICICI Prudential Life Insurance and attempted to provide some ways so as to make recruitment more effective and to reduce the cost of hiring an employee. I am privileged to be one of the students who got an opportunity to do my training with ICICI Prudential Life Insurance. My involvement in the project has been very challenging and has provided me a platform to leverage my potential in the most constructive way. ICICI Prudential Life insurance is one of India's leading financial institutions offering complete financial solutions that encompass every sphere of life. In a short span of time,ICICI has set an example by having a steady and confident journey to growth and success. During the training period I have studied deeply the process of hiring in ICICI Prudential Life insurance and did a SWOT analysis of ICICI Prudential Life Insurance to find out the existing shortcomings and potential threats and thereby recommended suggestions. This project however is an attempt to share as best as possible my experience in corporate world...
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...banking behemoths. Banks should then comply with the new capital requirements agreed by finance ministers by January 1, 2019. The question is, however, whether this is the right path to choose and whether these regulations will be able to prevent the world from any future financial markets crisis. So far, the proposed numbers themselves could hardly be described as tough, as the bounce in bank shares testified. Also, it seems that many important issues are not being addressed at all. (Plenty) But what are the issues that should be addressed? What would be the ideal regulatory state and is it possible to ever achieve it? Let us, first, start with our idea of the “ideal” international financial regulatory plan. After having researched various proposals for the international financial markets regulations, we reached a conclusion that finding the ideal path is going to represent a very difficult task and that none proposed regulation will be able to fit all the states. As mentioned in the article “Financial regulation: More questions than answers” which was posted in Businessline in the end of July, due to the variations in institutional legacies, traditions and systems in individual countries over the world, no one size can fit all. Also, however, we believe that as far as financial stability is concerned within any kind of arrangement that is deemed fit in a particular country, there is no need for a central bank to have a lead role. (Opinion) Any regulations will then require...
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...How did Financial Reporting Contribute to the Financial Crisis? Mary E. Barth & Wayne R. Landsman a a b Graduate School of Business , Stanford University , Stanford, CA, USA b Kenan–Flagler Business School , University of North Carolina at Chapel Hill , Chapel Hill, NC, USA Published online: 07 Jul 2010. To cite this article: Mary E. Barth & Wayne R. Landsman (2010) How did Financial Reporting Contribute to the Financial Crisis?, European Accounting Review, 19:3, 399-423, DOI: 10.1080/09638180.2010.498619 To link to this article: http://dx.doi.org/10.1080/09638180.2010.498619 PLEASE SCROLL DOWN FOR ARTICLE Taylor & Francis makes every effort to ensure the accuracy of all the information (the “Content”) contained in the publications on our platform. However, Taylor & Francis, our agents, and our licensors make no representations or warranties whatsoever as to the accuracy, completeness, or suitability for any purpose of the Content. Any opinions and views expressed in this publication are the opinions and views of the authors, and are not the views of or endorsed by Taylor & Francis. The accuracy of the Content should not be relied upon and should be independently verified with primary sources of information. Taylor and Francis shall not be liable for any losses, actions, claims, proceedings, demands, costs, expenses, damages, and other liabilities whatsoever or howsoever caused arising directly or indirectly in connection with, in relation to or arising out of the...
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...| |FINANCIAL MARKETS AND RISK | |17th October 2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ...
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