Systemically Important Banks (SIBs) in the Post-Crisis Era: 'The' Global Response, and Responses Around the Globe for 135 Countries

55 Pages Posted: 18 Jul 2013 Last revised: 24 Jul 2013

James R. Barth

Auburn University; Milken Institute

Chris Brummer

Georgetown University Law Center; The Institute of International Economic Law (IIEL); Atlantic Council; Milken Institute Center for Financial Markets

Tong Li

Milken Institute

Daniel E. Nolle

affiliation not provided to SSRN

Date Written: July 16, 2013

Abstract

Financial system policymakers around the world continue to respond vigorously to the problems in financial markets, financial institutions, and financial system regulation and supervision brought into high relief by the global financial crisis. However, the overall understanding of what those responses are remains rather vague and limited. Our study contributes to improving the state of knowledge by focusing on one particularly relevant issue, the regulation and supervision of systemically important banks (SIBs). The heart of our contribution is the presentation of information heretofore obscure, or new, or both. Our approach is to develop two complementary perspectives. The first perspective is what we have characterized as "the global view." That discussion begins by noting that the G20 and the Financial Stability Board (FSB) are the architects of the most significant agenda in the world to reform the global financial system, including in particular as that system operates through systemically important financial institutions (SIFIs). We explain what the G20 and the FSB are, how they came to occupy the driver's seat so to speak, and the evolution of their major financial system reform initiatives since the darkest days of the global financial crisis. Our discussion highlights SIFIs initiatives, emphasizing in particular those pertaining to global systemically important financial institutions/banks (G-SIFIs and G-SIBs). Our second perspective is a country-specific one. It starts by making the important observation that while most of the largest banks around the world have not been designated as "globally" systemically important, they are nevertheless systemically important when considered in a national or "domestic" context. Under those circumstances it is therefore fortunate that, due to recent World Bank efforts, a large set of information exists about the regulation and supervision of SIBs. Our study summarizes and highlights the new data collected by the World Bank on the post-crisis regulation and supervision of SIBs by 135 countries around the world. Broadly, that analysis shows that countries are more similar than different in the measures they have adopted for regulating and supervising SIBs. We conclude our study by suggesting that, although that fact should aid countries in coordinating policies internationally, there is a very long way to go in that respect.

Keywords: Systemically Important Financial Institutions, SIFIs, Systemically Important Banks, SIBs, G20, Financial Stability Board, FSB, Basel III, Basel Committee on Banking Supervision, Global Financial Crisis, International Financial System Regulation, Financial System Reform

JEL Classification: F33, F36, G15, G21, G28, K33, N20

Suggested Citation

Barth, James R. and Brummer, Chris and Li, Tong and Nolle, Daniel E., Systemically Important Banks (SIBs) in the Post-Crisis Era: 'The' Global Response, and Responses Around the Globe for 135 Countries (July 16, 2013). Available at SSRN: https://ssrn.com/abstract=2294641 or http://dx.doi.org/10.2139/ssrn.2294641

James R. Barth

Auburn University ( email )

415 West Magnolia Avenue
Auburn, AL 36849
United States
334-844-2469 (Phone)
334-844-4960 (Fax)

Milken Institute ( email )

1250 Fourth Street
Santa Monica, CA 90401
United States

Christopher J. Brummer

Georgetown University Law Center ( email )

Washington, DC 20057
United States

HOME PAGE: http://https://www.law.georgetown.edu/faculty/brummer-chris.cfm

The Institute of International Economic Law (IIEL) ( email )

Georgetown University Law Center
600 New Jersey Avenue, NW
Washington, DC 20001
United States

HOME PAGE: http://iielaw.org/member/chris-brummer-2/

Atlantic Council ( email )

1101 15th Street, NW
11th Floor
DC 20005
United States

HOME PAGE: http://www.atlanticcouncil.org/about/experts/list/chris-brummer

Milken Institute Center for Financial Markets ( email )

1250 Fourth Street
Santa Monica, CA 90401
United States

HOME PAGE: http://www.milkeninstitute.org/about/our-team/view/70

Tong Li

Milken Institute ( email )

1250 Fourth Street
Santa Monica, CA 90401
United States
310-570-4655 (Phone)
310-570-4625 (Fax)

Daniel E. Nolle (Contact Author)

affiliation not provided to SSRN

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