Back Matter

Back Matter

Author(s):
Aditya Narain, Inci Ötker, and Ceyla Pazarbasioglu
Published Date:
April 2012
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Index

[Page numbers followed by f, n, or t refer to figures, footnotes, or tables, respectively.]

A

  • Accountability
    • of macroprudential authorities, 30
    • subsidiarization rationale, 226
    • of supervisors, 5, 20, 21, 93, 94

B

  • Bail-in proposals, 151–153, 172
  • Bank for International Settlements, 5, 24, 29, 30, 258
  • Bank holding companies, 54, 201, 204, 205, 207, 209
  • Bank Holding Companies Act, 205
  • Basel Committee on Banking Supervision
    • capital and liquidity requirements, 3, 18, 38, 43–52, 57, 161, 182–183
    • countercyclical risk calculation, 29, 41–42
    • Core Principles for Effective Banking Supervision, 87, 88–89
    • Cross-Border Bank Resolution Group, 101, 110–112, 125–127, 191
    • in future of regulatory reform, 258
    • minimum common equity ratio, 144, 163–164
    • phased implementation of capital and liquidity rules, 4, 18–20, 19t, 40, 41t, 46, 64t, 182
    • point of nonviability proposal, 169–170
    • regulatory reform proposals, 38–40
    • on supervision of cross-border operations, 58, 234–235
  • Bear Sterns, 72

C

  • Capital and liquidity buffers
    • composition, 19–20, 40, 43, 54, 63–64
    • current reform efforts, 3
    • effects of reform proposals on LCFIs, 43–52, 57
    • effects of reform proposals on size of financial system, 254
    • goals for financial system, 1, 16
    • goals of new prudential regulation, 78
    • intangible and qualified assets in, 19–20, 40, 63
    • macroeconomic impact of reforms, 18
    • market-maker obligations to improve, 81
    • methodology for estimating impact of reforms, 61–64
    • origins of global financial crisis, 14, 18
    • phased implementation of Basel III requirements, 4, 18–20, 19t, 40, 41t, 46, 64t, 182
    • reforms in response to global crisis, 18–20, 40–41, 163–164, 182–183
    • risks for centralized LCFIs, 104–105
    • safeguards to prevent systemic risk, 57–58
    • for SIFIs, 8, 145–146, 154, 170, 171
    • See also Contingent capital instruments
  • Central banks
    • access to discount withdrawal facility, 201
    • access to emergency liquidity facilities of, 28, 120, 121, 146, 165, 172
    • in development and use of macroprudential policies, 30
    • regulator relationship, 93
    • risk assessment activities, 82
  • Central counterparties clearance, 27–28, 257
  • Choice between branch and subsidiary structure
    • business model considerations, 226–227, 229–230
    • cost considerations, 225, 237, 242–244
    • credit supply considerations, 232–233
    • current geographical distribution, 227, 231–232t
    • degrees of centralization, 222, 223–224
    • determinants of, 222, 228–230, 238
    • financial stability and, 223–227
    • home/host country factors in, 227, 228–229
    • liquidity management considerations, 226
    • management structure and function, 224
    • policymaker perspective, 232–237, 238
    • resolution considerations, 236–237, 239
    • risk management considerations, 226, 238–239
    • sharing of affiliate losses, 225, 235
    • stand-alone subsidiarization, 236, 241–242t
    • supervision responsibility, 222, 233, 234–235
    • trade-offs in, 221–222, 235–236
    • vulnerability to shocks, 225, 233–235
    • See also Cross-border operations; Subsidiarization
  • Clearing and settlement activities, 27, 54, 77, 79, 81, 127, 226, 257
  • Collateralized debt instruments, 80
  • Collateral valuation, 27
  • Competition
    • distortions associated with SIFIs, 136
    • expected reform outcomes, 11
    • goals for financial system, 1, 17
    • Volcker Rule effects, 209
  • Concentration of banking system, 39f, 134n, 255–256
  • Contingent capital instruments
    • applications, 165, 173
    • conversion rate, 166–167, 180–181t
    • in crisis management framework, 8, 26, 173
    • current interest in, 145, 161
    • with debt write-off features, 166–167
    • design, 173
    • distinctive features, 163
    • future prospects, 167–169, 173
    • versus hybrid instruments, 163, 182–184
    • as loss-absorbing buffer, 170–172
    • modeling of, 163, 173–177
    • monitoring, 173
    • purpose, 162
    • rationale, 8, 145, 161, 163–164
    • recent implementations, 169–172
    • tax and regulatory treatment, 167–168
    • trigger conditions, 26, 164–166, 169–170, 173, 178–179t
  • Contingent convertible bonds. See Contingent capital instruments
  • Counterparty risk, 252, 254, 257
    • Basel Committee proposals, 18, 40, 61, 140
    • branch versus subsidiary model, 226
    • concerns, 27
    • oversight, 73, 76, 81
    • requirements for ring-fenced banks, 211, 214
  • Credit default swaps, 80, 252
  • Credit rating agencies, 28, 204
  • Cross-border operations
    • centralization decisions, 222
    • crisis prevention and preparedness, 109, 111
    • future prospects, 254–255
    • growth of, 103–104
    • implementation of recovery and resolution plans, 192
    • implications for utility banking proposals, 200
    • international standards for supervision, 108
    • need for international coordination on, 237
    • origins of global financial crisis, 2, 38, 238
    • proposal for subsidiary structure of SIFIs, 10, 56–57, 112, 143–144, 190–191
    • as source of systemic risk for host jurisdiction, 105
    • Spanish model, 239–240
    • structure and organization, 104–105, 221–223
    • supervisory function in, 96, 103, 233, 234–235
    • See also Choice between branch and subsidiary structure; Resolution framework for cross-border banks

D

  • Deferred tax assets, 63–64
  • Deposit guarantee scheme, 120
  • Derivatives markets
    • clearing facilities, 257
    • effects of reforms, 52, 54–55
    • evolution of financial industry supervision, 74, 84
    • scope of regulation, 81
    • strategies for improving resilience of, 27–28
    • systemic risk prevention, 141n
  • Dodd-Frank Act, 54–55, 142, 150 See also Volcker Rule

E

  • Economic growth
    • effect of capital and liquidity requirement reforms, 18
    • future prospects, 252–253
    • goals of financial system reform, 3, 247
    • risk taking and, 16, 248
    • size of financial sector, 15f

F

  • Federal Deposit Insurance Corporation, 114n
  • Financial Sector Assessment Program, 20, 32, 87, 258–259
  • Financial Stability Board, 1, 5, 13, 24, 27, 28, 29, 30, 58, 95, 111, 135, 161, 186, 207, 258
  • Financial stability contributions, 22, 25–26
  • Financial Stability Oversight Council, 207, 208t
  • Financial system reforms, generally
    • effects on markets, 256–257
    • effects on size of financial system, 254
    • effects on structure of banking system, 255–256
    • future prospects, 12, 15–16, 32, 248–249, 251–257
    • goals, 1, 2, 3, 11–12, 16–17, 31–32, 247
    • macroprudential strategies for enhancing resilience, 24–30
    • rationale, 59–60t
    • response to global crisis, 2, 3f, 11, 13, 15–16, 35–36, 38–42, 247, 251
    • role of International Monetary Fund, 258–259
    • See also Implementation of reforms; Regulation
  • Fixed income, commodities, and credit instruments, 54–55
  • Fortis Group, 109, 110

G

  • Glass-Steagall restrictions, 142, 204–205
  • Global financial crisis
    • bail-out rationale for TITFs, 194
    • determinants of country outcomes, 83
    • effects of hybrid capital instruments, 163
    • lessons of, 75, 247
    • origins of, 1–2, 13, 14–15, 27, 35, 37–38, 37f, 73–75, 86, 134, 161, 201–202, 218, 238, 247, 249–251
    • reform efforts in response to, 2, 3f, 11, 13, 15–16, 35–36, 38–42, 72–73, 161
    • regulatory approach preceding, 71–72
    • supervision failures in, 86–87
  • Global systemically important banks, 145, 170
  • Group of Twenty, 1, 13, 22, 27, 30, 38, 71, 96, 101, 186

H

  • Hedge funds
    • assessment challenges, 207
    • contingent capital instruments market and, 168, 182
    • Glass-Steagall restrictions, 205
    • rationale for regulation, 76, 203
    • regulatory response to crises, 72, 73, 76
    • Volcker Rule requirements, 26, 52, 54, 142, 204, 207
  • Household borrowing, 249
  • Household borrowing and saving, 254

I

  • Implementation of reforms
    • international framework for resolution, 23–24, 58, 102, 124–125
    • key tasks, 3
    • monitoring effects of, 31
    • need for global consistency and coordination in, 11, 31, 32, 56, 58, 101
    • phased-in capital and liquidity requirements, 4, 18–20, 19t, 40, 41t, 46
    • policy implications of SIFI reform proposals, 216–217
    • prevention of unintended consequences of regulatory reforms, 75
    • private sector role in, 3, 13
    • recovery and resolution plans, 9, 151, 188–189, 191
    • role of international institutions, 13, 32, 33t, 258–259
    • significance of, in reform effectiveness, 87
    • systemic risk shifting in response to, 4, 8, 36, 56, 193, 195, 200, 216–217
  • Independent Commission on Banking (United Kingdom), 144, 204, 209–215, 216
  • Insurance, bank involvement in
    • Basel capital requirements, 45, 53
    • globalization trends, 103
    • market value of, 156
    • principles of supervision, 90
    • reforms in response to global crisis, 72–73
    • supervision before global crisis, 84
  • Interest rates
    • competitive advantages of SIFIs, 136, 136f
    • macroprudential policies to reduce systemic risk, 30
  • International Accounting Standards Board, 258
  • International Association of Deposit Insurers, 258
  • International Association of Insurance Supervisors, 82, 87, 90
  • International Monetary Fund, 2, 5, 13, 17, 18, 24, 27, 28, 29, 30, 32, 33t, 58, 147, 255, 258–259
  • International Organization of Securities Commissions, 80, 81, 82, 87, 89–90, 258
  • International Swaps and Derivatives Association, 127
  • Investment banks
    • branch versus subsidiary structure, 226–227
    • definition, 156
    • effects of regulatory proposals, 52, 53f, 54–55
    • proposed capital and liquidity requirements, 4, 44–45, 52
    • Volcker Rule requirements, 203

L

  • Large and complex financial institutions (LCFIs)
    • asset composition leading up to crisis, 38
    • definition, 35n
    • effects of proposed capital requirements, 42–47, 61–64
    • effects of proposed liquidity requirements, 42–43, 47–52, 48t
    • effects of proposed regulations, 36–37, 56
    • evolution of financial industry supervision, 85
    • financial system reform needs, 2
    • growth of, 103–104
    • origins of global financial crisis, 2, 35, 37–38, 134, 251
    • reform efforts in response to global crisis, 36
    • risks for centralized organizations, 104–105
    • structure and organization, 104
    • See also Systemically important financial institutions (SIFIs)
  • Lehman Brothers, 22, 27, 72, 109, 110
  • Leveraging of financial system
    • current reform requirements, 40
    • filter rule test, 218–220
    • goals of new prudential regulation, 78
    • origins of global financial crisis, 14, 218, 250
    • rationale for regulation, 75–76, 77
  • Liquidity Coverage Ratio, 40
  • Living wills. See Recovery and resolution plans
  • Long-Term Capital Management, 73, 76

M

  • Macroprudential policies
    • financial system reform needs, 3, 30
    • goals for financial system reform, 17
    • monetary policy and, 30
    • reform rationale, 59–60t
    • reforms in response to global crisis, 2, 41–42
    • research needs, 30, 31
    • strategies for increasing systemic resilience, 24–29
  • Market functioning
    • branch versus subsidiary structure considerations, 227, 230, 233
    • distortions associated with SIFIs, 136–137
    • entry and exit, 1, 17
    • future prospects, 256–257
    • origins of global financial crisis, 72, 75
    • strategies for enhancing resilience in, 27–29
    • transparency, 29
  • Microprudential policies
    • goals for financial system reform, 17
    • reform rationale, 59–60t
    • reforms in response to global crisis, 2
    • strategies for increasing institutional resilience, 17–24
  • Mortgage servicing rights, 64

N

  • Narrow funding banks, 193, 195, 201–202, 217
  • Net stable funding ratio, 19, 40–41, 49
    • methodology for assessing impact of, 65–66t
  • Nonbank financial system
    • future prospects, 253
    • in global financial crisis, 15
    • growth of, 16f, 250
    • regulatory goals, 17, 19, 31, 253
    • resolution, 6, 23, 103, 106, 150

O

  • Off-balance-sheet activities
    • accounting rules, 29, 149
    • current status, 15
    • regulatory reforms, 72
    • supervision, 86, 91
    • trends before global crisis, 35, 72, 84, 249

P

  • Prevention and preparedness, 109, 111, 251
  • Private equity investments
    • bail-in debt to aid resolution of, 151–153
    • regulatory goals, 76, 82
    • Volcker Rule on, 26, 52, 54, 142, 204, 205
  • Private sector
    • debt-for-equity conversions for resolution, 22–23
    • funding of resolution process, 120–122
    • in implementation of reforms, 3, 13
    • industry views on potential impacts of reforms proposals, 67–69t
    • origins of global crisis, 2
    • supervisor relationship with, 95
  • Procyclicality
    • contingent capital investments and, 8, 170, 173, 183–184
    • current reform efforts, 41–42
    • goal of reforms, 1, 2, 16, 24, 252
    • origins of global financial crisis, 250
    • research needs, 29
  • Proprietary trading
    • complementary regulations to ban on, 216, 217
    • filter rule test, 218–220
    • future prospects, 209, 254
    • LCFI activities, 56n
    • Volcker Rule on, 26, 52, 54, 142, 203, 204, 205, 207, 209

R

  • Rabobank Senior Contingent Notes, 167
  • Recovery and resolution plans, 22
    • benefits, 188, 191
    • in crisis management framework, 186
    • cross-border implementation, 192
    • data needs for, 187, 188–189
    • definition, 185
    • development of, 187–188
    • effects on business strategy, 56–57
    • goals for SIFIs, 186, 237n
    • implementation challenges, 9, 151, 188–189
    • interaction with other plans, 189–191
    • policy implications, 191–192
    • rationale, 9, 151, 185–186
    • recent implementations, 191
    • recovery component, 186–187
    • resolution component, 187
    • structure, 151
    • subsidiarization and, 237
  • Reducing size of SIFIs
    • challenges to, 10, 143
    • potential negative consequences of, 10, 22
    • rationale, 9, 142, 194
    • recent initiatives, 142–143
    • separation of financial and nonfinancial activities, 79–80, 142–143
    • strategies for, 9, 22
    • structural constraints to, 26–27
    • utility banking proposals, 196–201
  • Regulation
    • branch versus subsidiary structure considerations, 227, 228, 233–235
    • of companies with financial and nonfinancial activities, 79–80
    • conduct-of-business, 77
    • of credit rating agencies, 28
    • current compliance with good practices, 20, 21f
    • design of new prudential regulation, 77–80
    • effects of proposals on LCFIs, 36–37
    • financial system reform needs, 2, 3, 31
    • future prospects, 32, 248, 251–257
    • goals for financial system reform, 17, 73, 75–77
    • implications for bank business strategies, 52–56
    • industry views on potential impacts of proposals, 67–69t
    • lessons from global crisis, 4, 75
    • of nonbank institutions, 253
    • organization and governance of, 80
    • origins of global financial crisis, 2, 4, 13, 14, 15, 37–38, 72, 73–75, 86, 247, 250–251
    • prevention of unintended consequences of, 57–58, 72, 75
    • procyclicality risk, 16, 24, 41–42, 147
    • of products, 80–81
    • rationale for limiting, 71–72, 75
    • rationale for wider perimeter of, 4, 17, 58, 71, 75
    • recommendations for expanded perimeter, 73, 75, 82
    • reform challenges, 4–5
    • reforms in response to global crisis, 2, 3f, 11, 13, 15–16, 35–36, 38–42, 72–73, 248, 251
    • research needs, 31
    • scope of financial institutions subject to, 77, 78–79
    • supervision and, 5, 93
    • systemic risk assessment to determine boundaries of, 25, 82
    • systemic risk shifting in response to, 4, 8, 36, 56, 193, 195, 200, 216–217, 253
  • Remuneration practices, 74
  • Repo markets, 27
  • Resolution framework for cross-border banks
    • authority for, 116–117, 125
    • basic elements, 114–115
    • challenges to development, 6, 9
    • communication and information management in, 124
    • coordination standards for, 115, 116–119, 255
    • corporate solvency model, 112–114
    • costs of current approach, 108–109
    • creditor safeguards in, 117, 118
    • Cross-Border Bank Resolution Group initiatives, 110–112, 125–127
    • current status, 150, 255
    • deposit guarantee scheme, 120
    • funding of resolution process, 115, 120–122
    • harmonization of national law for, 116–118
    • implementation issues, 23–24, 58, 102, 124–125
    • leadership for implementation, 122–123
    • modification of national law for, 114, 115–116
    • national frameworks, 105–107
    • need for, 6, 17, 58, 101–102, 103–104, 124, 153, 237, 239
    • nonbank institutions and, 103, 106, 123
    • objectives, 101–102, 251
    • obstacles to, 150
    • proposed structure, 6, 23
    • risk mitigation mechanisms, 126–127
    • scope of activities in, 102
    • strategies for, 22
    • supervision frameworks and, 103, 107, 108, 118–119
    • territoriality approach to insolvencies, 107
    • transfer of contractual relationships, 127
    • treaty approach, 102, 111–112
    • United Nations Model Law, 113, 127–131
    • universality approach to insolvencies, 107, 111–112, 114
    • See also Cross-border operations
  • Resolution of failed institutions
    • bail-in power to aid in, 151–153, 172
    • cross-border banks. See Resolution framework for cross-border banks
    • current status of plans for, 6
    • debt-to-equity conversions for, 22–23, 151
    • funding for cost of, 22
    • goals for financial system, 1, 3, 16, 17
    • lesson from global crisis, 22
    • levy on SIFIs to reduce effects of, 22, 25–26
    • origins of global financial crisis, 251
    • proposed framework, 23–24
    • reform challenges, 6, 23
    • SIFIs, 6–7, 8, 149–151
    • significance of, in reform effort, 6, 22
    • strategies for, 22
    • use of contingent capital instruments, 165, 166
    • See also Recovery and resolution plans
  • Ring-fencing
    • capital costs, 242–244
    • cross-border resolution and, 23, 105, 106, 130
    • motivation, 107, 115, 195, 210
    • policy implications, 195
    • protection from contagion, 211–212
    • recent policy formulations, 142–143, 193, 195, 209–210
    • requirements under, 195, 210–211, 213–214
    • retail operations, 214–215
    • See also Subsidiarization
  • Risk management
    • benefits of utility banking, 197–198
    • counterparty clearance, 257
    • current trends in global financial system, 252–253
    • economic growth and, 16, 248
    • goals of regulation, 75–77
    • goals of Volcker Rule, 203
    • growth of cross-border operations, 104
    • incentives, 73, 79, 248
    • levies and surcharges to improve, 25–26, 144–145, 146–147
    • liquidity risk assessment, 146, 146n
    • models of bailout and, 173–177
    • origins of global financial crisis, 2, 13, 14, 35, 37–38, 72, 73–75, 250–251
    • prevention of unintended consequences of reforms, 57–58, 72, 75, 216–217
    • procyclicality effects, 29
    • rationale for contingent capital instruments, 163, 164–166
    • rationale for limiting prudential regulation, 71–72
    • recommendations for capital and liquidity requirements, 18
    • remuneration practices and, 74
    • securitization and, 28–29
    • shielding ring-fenced banks from contagion, 211–212, 213–214
    • in SIFIs, 8, 194
    • strategies to reduce systemic risk, 25–27, 35–36
    • supervision failures in global financial crisis, 86–87
    • systemic risk assessment, 24–25, 73, 82
    • TITF problem, 133–134
    • in traditional banking, 193–194
    • transparency and disclosure for, 5
    • See also Reducing size of SIFIs; Regulation; Supervision

S

  • Securities market
    • origins of global financial crisis, 74–75
    • reforms in response to global crisis, 72–73
    • scope of regulation, 81
    • Volcker rule effects on competition in, 209
  • Securitization
    • effects of reforms, 52
    • evolution of financial industry supervision, 84
    • future of regulation, 29, 253
    • origins of global financial crisis, 28, 74, 75
    • reforms in response to global crisis, 28–29
  • Shadow banking
    • assets, 71
    • definition, 56n
    • financial sector interconnectedness, 38
    • growth, 16f
    • liabilities preceding crisis, 39f
    • origins of global financial crisis, 15, 38, 39f
    • systemic risk shifting in response to regulation, 4, 8, 36, 56, 193, 195, 200, 216–217, 257
  • Special Investment Vehicles, 76, 77
  • Stand-alone subsidiarization, 236, 241–242t
  • Subsidiarization
    • allowable activities, 210–211
    • assessment challenges, 213–214
    • costs, 144, 190–191, 242–244
    • home/host country policy decisions, 232–237
    • implementation in United Kingdom, 209–215
    • management structure, 212
    • objective, 210
    • organization of retail banking, 214–215
    • protection from contagion, 211–212
    • prudential capital constraints, 212, 212t
    • rationale, 10, 56–57, 112, 143–144, 195, 210
    • restrictions on intragroup transactions, 212, 213–214
    • systemic risk for host jurisdiction in, 105
    • See also Choice between branch and subsidiary structure; Ring-fencing
  • Supervision
    • accountability for, 21, 93, 94
    • agency mandates for, 20, 21
    • characteristics of financial industry oversight, 84
    • colleges, 111, 119n, 255
    • compliance-based, 84
    • of cross-border operations, 96, 222, 233, 234–235
    • current compliance with good practices, 20, 21f, 87–90
    • as determinant of financial crisis outcomes, 83
    • development of recovery and resolution plans, 188
    • enforcement-based, 84
    • evolution of, in financial industry, 84–85
    • financial system reform needs, 2, 3, 17
    • framework for enhancing, 20, 21
    • future prospects, 252
    • goals for new prudential regulation, 78
    • international cooperation in resolution and, 103, 107, 108, 118–119
    • international standards, 98–100t, 108, 118–119, 255
    • legal authority, 92
    • lessons from global crisis, 85
    • objectives, 94
    • operational independence for, 94
    • organization and processes, 93
    • origins of global financial crisis, 2, 13, 86–87, 247, 250–251
    • professional status, 96
    • recommendations for, 95–96
    • reforms in response to global crisis, 72–73
    • regulation and, 5, 93
    • relationships with other agencies, 93
    • relationship with industry, 95
    • requirements for effectiveness, 5, 20, 85, 90–95, 97
    • resources for, 21, 92, 94, 96
    • ring-fenced banks, 213–214
    • risk assessment capacity for, 21
    • risk-based, 84
    • scope of activities in, 83
    • of SIFIs, 5, 8, 147–148
    • significance of, in reform effort, 5, 20, 83
    • strategy for, 21, 93
    • Volcker Rule implementation challenges, 207
  • Swap Push-out Rule, 143
  • Systemically important financial institutions (SIFIs)
    • bail-in power to aid resolution of, 151–153, 172
    • bail-out decisions, 139, 140, 194
    • benefits of, 135–136, 221
    • capital and liquidity buffer requirements, 145–146, 154, 170, 171
    • competitive advantage, 136–137
    • cross-border activity, 138
    • current risk mitigation efforts, 2, 41–42, 42t 140
    • data template for, 5
    • definition, 73, 75–76, 133n
    • design of new prudential regulation, 78–80
    • economies of scale/scope, 155
    • financial stability contributions, 22, 25–26
    • frequency of distress, 138–139, 138f
    • future prospects, 135, 154
    • interconnectedness, 134, 137f, 138
    • interest rates charged to, 136, 136f
    • market value, 155–156
    • origins of global financial crisis, 134, 194
    • outcomes of global financial crisis, 134
    • policy implications of reform proposals, 216–217
    • political influence, 137
    • recent growth, 137, 137f, 139–140
    • recovery and resolution plans, 151, 186
    • reform challenges, 6–8, 143
    • reform goals, 11–12, 73, 135, 140
    • resolution strategies, 22, 149–151
    • risk assessment, 24–25, 73
    • risk-based levies and surcharges, 25–26, 144–145, 146–147
    • risk-based prudential requirements, 25
    • risk of unintended consequences in
    • rescoping of, 195–209, 216–217
    • risks associated with, 194, 221
    • size characteristics, 137–138, 157–159
    • strategies for risk reduction, 8, 25–27, 135, 140, 141–142, 141f, 194–195, 221
    • subsidiarization proposals, 10, 56–57, 105, 112, 143–144, 190–191
    • supervision needs, 5, 147–148
    • transparency of operations, 8, 148–149
    • See also Recovery and resolution plans; Reducing size of SIFIs; Too-important-to-fail institutions

T

  • Taxation
    • branch versus subsidiary structure considerations, 227, 228–229
    • of multinational groups, 104
    • to reduce institutional risk taking, 26
    • risk-related levies and surcharges, 144–147
    • treatment of contingent capital instruments, 167
  • Too-important-to-fail institutions
    • bail-out rationale, in global crisis, 194
    • capital and liquidity buffer requirements, 154
    • contingent capital strategies for, 162–164
    • financial system reform needs, 2
    • nature of risk associated with, 133–134, 153, 221
    • origins of global financial crisis, 2, 15, 134
    • outcomes of global financial crisis, 134
    • strategies to reduce risk from, 153–154, 221
    • See also Recovery and resolution plans; Reducing size of SIFIs; Systemically important financial institutions (SIFIs)
  • Traditional commercial banks
    • efficient size, 155
    • growth, 16f
    • liabilities preceding crisis, 39f
    • ownership concentration, 39f
    • proposed capital and liquidity rules, 4, 52
    • Volcker Rule requirements, 203
  • Transparency
    • to assess systemic risk, 73
    • expected reform outcomes, 11
    • financial system reform needs, 2, 5
    • future prospects, 256–257
    • goals for financial system, 1, 16, 17
    • origins of global financial crisis, 14, 37–38
    • in SIFIs, 8, 148–149
    • significance of, in reform effort, 5
    • strategies for enhancing market stability, 29

U

  • United Nations Commission on International Trade Law, 112–114, 116n, 127–131
  • Universal banks
    • branch versus subsidiary structure, 222, 226–227
    • current capital structure, 43
    • definition, 103n, 156
    • growth of, 103–104, 194
    • proposed capital requirements, 44–45, 46, 53
    • ring-fencing, 209–210, 211, 213
    • SIFI banks, 138, 139, 140
    • transformation into utility banks, 196f, 200–201, 216
    • Volcker Rule and, 52, 54
    • vulnerability to shocks, 194
  • Utility banking
    • adjustment costs, 200–201
    • definition, 196
    • impact analysis, 199t
    • implementation challenges, 200
    • policy implications of SIFI reform proposals, 216–217
    • rationale, 196
    • risk reduction benefits, 197–198
    • scope of proposals for, 196–197, 197f social costs, 198–199
    • transformation of universal banking into, 196f, 201, 216f

V

  • Volcker Rule
    • challenges to implementation, 195
    • effects on competitiveness in securities markets, 54, 209
    • essential requirements, 26, 52, 56, 195, 204–205, 205f, 206t implementation, 204
    • implementation challenges, 193, 205–209
    • Independent Commission on Banking ring-fencing rules and, 214, 215t, 216
    • rationale, 142–143, 203–204
    • risk of unintended consequences, 193, 195, 209

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