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Restructuring the Banking System to Improve Safety and Soundness

In: The Social Value of the Financial Sector Too Big to Fail or Just Too Big?

Author

Listed:
  • Thomas M. Hoenig

    (Federal Deposit Insurance Corporation, USA)

  • Charles S. Morris

    (Federal Reserve Bank of Kansas City, USA)

Abstract

The following sections are included:Executive SummaryProposalWhy Restricting Activities Is the SolutionEvolution of Current Financial StructureRegulationIncreased CompetitionShadow BankingExpansion of Bank ActivitiesImplications for Financial Structure, Stability, and RiskChanges in Financial Structure and StabilityNew Activities Make It More Difficult to Manage and Monitor RiskProposal to Reduce Costs and Risks to the Safety Net and Financial SystemRestricting Activities of Banking OrganizationsReforming the Shadow Banking SystemReferences

Suggested Citation

  • Thomas M. Hoenig & Charles S. Morris, 2013. "Restructuring the Banking System to Improve Safety and Soundness," World Scientific Book Chapters, in: Viral V Acharya & Thorsten Beck & Douglas D Evanoff & George G Kaufman & Richard Portes (ed.), The Social Value of the Financial Sector Too Big to Fail or Just Too Big?, chapter 21, pages 401-425, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789814520294_0021
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    References listed on IDEAS

    as
    1. Acharya, Viral V. & Schnabl, Philipp & Suarez, Gustavo, 2013. "Securitization without risk transfer," Journal of Financial Economics, Elsevier, vol. 107(3), pages 515-536.
    2. Martin Hellwig, 2010. "Capital Regulation after the Crisis: Business as Usual?," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(02), pages 40-46, July.
    3. repec:ces:ifodic:v:8:y:2010:i:2:p:14566986 is not listed on IDEAS
    4. Donald P. Morgan, 2002. "Rating Banks: Risk and Uncertainty in an Opaque Industry," American Economic Review, American Economic Association, vol. 92(4), pages 874-888, September.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Marco Migueis, 2019. "Evaluating the AMA and the new standardized approach for operational risk capital," Journal of Banking Regulation, Palgrave Macmillan, vol. 20(4), pages 302-311, December.
    2. Marco Migueis, 2017. "Forward-looking and Incentive-compatible Operational Risk Capital Framework," Finance and Economics Discussion Series 2017-087, Board of Governors of the Federal Reserve System (U.S.).
    3. Haq, Mamiza & Tripe, David & Seth, Rama, 2022. "Do traditional off-balance sheet exposures increase bank risk?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 80(C).
    4. Arnoud W. A. Boot & Lev Ratnovski, 2016. "Banking and Trading," Review of Finance, European Finance Association, vol. 20(6), pages 2219-2246.
    5. Karolina Puławska, 2021. "The Effect of Bank Levy Introduction on Commercial Banks in Europe," JRFM, MDPI, vol. 14(6), pages 1-26, June.
    6. Maurizio Trapanese, 2021. "The economics of non-bank financial intermediation: why do we need to fill the regulation gap?," Questioni di Economia e Finanza (Occasional Papers) 625, Bank of Italy, Economic Research and International Relations Area.
    7. Mr. Itai Agur & Mr. Sunil Sharma, 2013. "Rules, Discretion, and Macro-Prudential Policy," IMF Working Papers 2013/065, International Monetary Fund.
    8. Song, Fenghua & Thakor, Anjan V., 2019. "Bank culture," Journal of Financial Intermediation, Elsevier, vol. 39(C), pages 59-79.
    9. Leonardo Gambacorta & Adrian van Rixtel, 2013. "Structural bank regulation initiatives: approaches and implications," BANCARIA, Bancaria Editrice, vol. 6, pages 14-27, June.
    10. Joseph P. Hughes & Loretta J. Mester, 2018. "The Performance of Financial Institutions: Modeling, Evidence, and Some Policy Implications," Departmental Working Papers 201805, Rutgers University, Department of Economics.
    11. Hughes, Joseph P. & Mester, Loretta J., 2013. "Measuring the Performance of Banks: Theory, Practice, Evidence, and Some Policy Implications," Working Papers 13-28, University of Pennsylvania, Wharton School, Weiss Center.
    12. Festić Mejra, 2019. "International Environment: Recovery and Resolution Regimes as the Pillar of the Banking Union," Naše gospodarstvo/Our economy, Sciendo, vol. 65(2), pages 30-40, June.
    13. R. Christopher Whalen, 2013. "Why Fixing the 'Shadow Banking' Sector is Essential for the U.S. Housing Market," NFI Policy Briefs 2013-PB-01, Indiana State University, Scott College of Business, Networks Financial Institute.
    14. Thomas Hoenig, 2013. "The Case for Simple Rules and Limiting the Safety Net," Cato Journal, Cato Journal, Cato Institute, vol. 33(3), pages 485-489, Fall.
    15. Charles S. Morris, 2011. "What should banks be allowed to do?," Economic Review, Federal Reserve Bank of Kansas City, vol. 96(Q IV), pages 55-80.

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    More about this item

    Keywords

    Depository Institutions; Banks; Too-Big-to-Fail; Financial Innovations;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G2 - Financial Economics - - Financial Institutions and Services
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • L5 - Industrial Organization - - Regulation and Industrial Policy

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