Marco RaabeBankenregulierung im institutionellen Kontext Lateinamerikas

About this book deutschenglish

In the last 30 years, no other region in the world has suffered more from banking crises than Latin America. Besides the general macroeconomic instability in the region, a deficient regulation is widely recognized as a major root cause for the high vulnerability of banking systems in Emerging markets. The theory of banking regulation is, therefore, often criticized for being too abstract and ignoring in particular the institutional setting in which regulation is applied.

This book covers two main questions concerning the interdependence of banking regulation and institutional setting based on case studies for Argentina and Chile:

• Do institutional deficits lead to a need for enhanced banking regulation in emerging markets compared to industrial countries?
• How does the institutional setting influence the effectiveness of regulation instruments and what lessons can be drawn for an optimal banking regulation in emerging markets?

The case studies reveal that banks depend on several institutions to overcome the problem of asymmetric information which is inherent to all banking systems. Without proper credit registers, secure property rights or reliable macroeconomic institutions banks are not able to manage risks adequately. Once moral hazard is furthermore not kept under control through a set of institutions, the inherent instability of the banking system rises further and often leads to a systematic banking crisis.

In this context it becomes clear that common best-practice solutions for banking regulation (e.g. Basel I - III) are not fit for purpose to maintain the stability of banking systems in Latin America and other emerging markets.