Relaxing capital requirements would plant the seeds of the next banking crisis [Nicolas Véron - HIC]

HQ of of the Bank for International Settlements (BIS) in Basel | Fabrice Coffrini/AFPBanking regulation goes in cycles that are punctuated by crises. Typically, a crisis results in regulatory tightening. Then after an extended period of time, memories of the crisis fade away, and policymakers end up yielding to bank lobbyists‘ constant push for loosen the rules. Then banks take more risk as allowed by the weaker new rules, and more often than not, a banking crisis erupts. Then everyone ask

2024.10.25 11:11

Latest financial supervisory reform diverts China from the path towards a market-based financial system [Nicolas Véron - HIC]

The Chinese Communist Party logo is seen on a skyscraper in Shanghai at dusk on Aug. 31. GREG BAKER/AFP VIA GETTY IMAGESIn May last year, China inaugurated a new system of financial sector supervision, which had been announced two months earlier during the twin plenary sessions of the National People‘s Congress and Chinese People’s Political Consultative Conference. One year on, it is time to take stock. Sadly, all indications suggest that the supervisory overhaul will make it more d

2024.04.26 11:14