Język Polski
English
Published
:
2011-04-30
Banks Regulatory Problems in EU Context
Jan Szambelańczyk
Piotr Bodył Szymala
Abstract
The secular trend in the development of civilisation proves that people and organizations have expanded the social space of their activities and that the role of money, as well as instruments and financial markets in trade and commerce has been growing. Market economies are characterized by volatility associated with business cycles that for financial systems carry not only risk but also financial instability along with threats to sustainable growth. The targets of the EU financial safety network should respect the fundamental rules of fair competition, which cannot be achieved without reliable and commonly available information addressed to homo contractor. That is particularly essential in the case of large financial groups whose importance to economy may be used to justify public guarantees. The Too Big To Fail (TBTF) doctrine should be gradually replaced by the rule of adequate participation in the cost of covering systemic risk posed by large financial institutions or substituted by the Too Big To Exist (TBTE), which is the case in the U.S. Apart from the "Europeanization" of entities equipped with powers of market regulators, when it comes to large financial institutions in particular, improvements to the Capital Accord (provided for in the Basel III framework) are a priority on the way to build an effective financial sector safety network in the EU. What should be noted here is the wide range of methods for determining minimum regulatory capital requirements provided for in the Capital Accord and individualization - especially when it comes to advanced risk measurement. Furthermore, the assumption that the competences of market regulator's employees recruited at a low cost will be enough for probing the performance of better paid and more numerous bank personnel is overly idealised. More importance should be attached to human risk in the process of developing a safe financial market framework, or the so-called model risk. The article analyzes the model proposed by a group of European regulators chaired by Jacques de Larosiere assuming collaboration between the European Systemic Risk Council, banking, insurance and securities market supervision authorities (including the European Banking Authority) and member states' market regulators. It is a hermeneutical search for supervision measures adequate to the economic situation while expecting that their effectiveness be inversely proportionate to the time needed to make a decision this way. The conflict between the interests of management effectiveness and respect for national particularism seems to be a fundamental challenge for the new safety network architecture proposed by the European Commission. This part of the article refers to proposals put forward in the middle of 2010 to limit bonuses in the financial sector. What is more, the paper analyses the European banking supervision model based on the criterion of the cost of regulatory actions and the assessment of the Community rehabilitation fund's operations as a tool ensuring resources to finance the consequences of such regulatory measures." (original abstract)Keywords:
Bank supervision, Financial market supervision, Banking risk, Financial safety netMost read articles by the same author(s)
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Szambelańczyk, J., & Bodył Szymala, P. (2011). Banks Regulatory Problems in EU Context. Zeszyty Naukowe Wyższej Szkoły Bankowej W Poznaniu, 33(33). Retrieved from https://journals.wsb.poznan.pl/index.php/znwsb/article/view/1493