Bank Regulation and Supervision in Bank-Dominated Financial Systems: A Comparison Between Japan and Germany
Posted: 2 Mar 2009
Date Written: March 1, 2009
This paper compares bank regulation and supervision in Japan and Germany. We consider these countries because they both have bank-dominated financial systems and their banking systems are often lumped together as one model, yet, bank stability differs significantly. We show that Japan and Germany have chosen different approaches to bank regulation and supervision and ask why they made their choices. We argue that bank regulation and supervision were less efficient in Japan than in Germany and that these differences were decisive for bank behavior.
Keywords: Japan and Germany, Bank regulation and supervision, Deposit insurance, Lender of last resort, Forbearance, Varieties of capitalism
JEL Classification: G21, G38, P52
Suggested Citation: Suggested Citation