Current Challenges in Financial Regulation

Financial intermediation and financial services industries have undergone many changes in the past two decades due to deregulation, globalization, and technological advances. The framework for regulating finance has seen many changes as well, with approaches adapting to new issues arising in specific groups of countries or globally. The objectives of this paper are twofold: to review current international thinking on what regulatory framework is needed to develop a financial sector that is stable, yet efficient, and provides proper access to households and firms; and to review the key experiences regarding international financial architecture initiatives, with a special focus on issues arising for developing countries. The paper outlines a number of areas of current debate: the special role of banks, competition policy, consumer protection, harmonization of rules-across products, within markets, and globally-and the adaptation and legitimacy of international standards to the circumstances facing developing countries. It concludes with some areas where more research would be useful.

Bibliographic Details

Main Author:	Claessens, Stijn
Language:	English en_US
Published:	World Bank, Washington, DC 2006-12
Subjects:	ACCOUNTING, ADVERSE EFFECTS, ADVERSE IMPACT, AGENCY PROBLEMS, AUDITING, BANKING SUPERVISION, BANKING SYSTEM, BANKING SYSTEMS, BANKS, BARRIERS TO ENTRY, BASLE CORE PRINCIPLES, BONDS, BROKERS, CAPITAL MARKETS, CENTRAL BANK, CLEARING SYSTEMS, COMMERCIAL BANKS, COMPARATIVE ADVANTAGES, COMPETITION POLICY, COMPETITIVE ENVIRONMENT, CONSOLIDATION, CONSUMER PROTECTION, CONSUMERS, CORPORATE FINANCE, CORPORATE GOVERNANCE, DECISION-MAKING, DEPOSIT INSURANCE, DEPOSITS, DEREGULATION, DERIVATIVES, DEVELOPMENT STRATEGIES, ECONOMIES OF SCALE, EMERGING MARKETS, EXTERNALITIES, FAIR TRADING, FINANCIAL CONGLOMERATES, FINANCIAL CRISES, FINANCIAL CRISIS, FINANCIAL DEREGULATION, FINANCIAL INSTITUTION, FINANCIAL INSTITUTIONS, FINANCIAL INSTRUMENTS, FINANCIAL INTEGRATION, FINANCIAL INTERMEDIATION, FINANCIAL LIBERALIZATION, FINANCIAL MARKETS, FINANCIAL PERFORMANCE, FINANCIAL REGULATION, FINANCIAL REPORTING, FINANCIAL RESTRUCTURING, FINANCIAL SECTOR, FINANCIAL SERVICES, FINANCIAL STABILITY, FINANCIAL SYSTEMS, FINANCIAL TRANSACTIONS, FIXED COSTS, FOREIGN ENTRY, GLOBALIZATION, HEDGE FUNDS, INFORMATION ACQUISITION, INFORMATION SYSTEMS, INNOVATIONS, INSURANCE, INSURANCE COMPANIES, INSURANCE MARKETS, INTEREST RATE, INTERNATIONAL BANKS, INVESTMENT BANKING, INVESTMENT BANKS, LEVEL PLAYING FIELD, LIQUIDITY, MARKET BEHAVIOR, MARKET DISCIPLINE, MORAL HAZARD, MORTGAGE LOANS, MUTUAL FUNDS, NATURAL MONOPOLY, NEGATIVE EXTERNALITIES, NON-BANK, NON-BANKS, NONBANK FINANCIAL INSTITUTIONS, PENSION FUNDS, PHONES, POLITICAL ECONOMY, PRICE SETTING, PRIVATIZATION, PRODUCT DIFFERENTIATION, PRODUCTION FUNCTION, PROFITABILITY, REGULATORY AGENCIES, REGULATORY APPROACHES, REGULATORY CHALLENGES, REGULATORY FRAMEWORK, REGULATORY REGIMES, REGULATORY SYSTEMS, REORGANIZATION, RISK MANAGEMENT, SECURITIES, SECURITIES MARKETS, STOCK EXCHANGES, SUBORDINATED DEBT, SUNK COSTS, TECHNICAL ASSISTANCE, TELECOMMUNICATIONS, TRADING SYSTEMS, TRANSPARENCY, UNIVERSAL SERVICE, VALUATION, WEALTH,
Online Access:	http://documents.worldbank.org/curated/en/2006/12/7289499/current-challenges-financial-regulation https://hdl.handle.net/10986/9261
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