The Changing Nature of Banking and Why it Matters

Buckley, R; Avgouleas, E and Arner, D (eds), Rethinking Global Finance and Its Regulation (Cambridge University Press, 2015 Forthcoming)

UNSW Law Research Paper No. 2015-19

25 Pages Posted: 5 May 2015

See all articles by Ross P. Buckley

Ross P. Buckley

University of New South Wales (UNSW) - Faculty of Law

Multiple version iconThere are 2 versions of this paper

Date Written: May 3, 2015

Abstract

Banks have been a ubiquitous feature of almost all successful civilisations. When asked what they understand a bank to be, most people describe an institution that accepts deposits and makes loans -- what we generally understand as a ‘retail’ bank. However, the banks at the centre of our global financial system are utterly different. Entities such as JP Morgan Chase, UBS or Deutsche Bank do a great deal more than take deposits and grant loans.

Banks have changed from a relatively local institution working in the client’s interests, to a far more complex organisation that is intent on maximising profits and the number of products it can sell to customers.

The implications of these changes are profound, especially if we think of the economic consequences of the allocation of much of our most talented human capital away from high value-added roles in the real economy to the banking sector.

This chapter will seek to explore the full dimensions of this transformation and analyse why it matters for how we think about banks today, and the regulations we pass to govern them.

Keywords: banks, banking, profit maximisation, economic consequences, transformation, regulation, governance

Suggested Citation

Buckley, Ross P., The Changing Nature of Banking and Why it Matters (May 3, 2015). Buckley, R; Avgouleas, E and Arner, D (eds), Rethinking Global Finance and Its Regulation (Cambridge University Press, 2015 Forthcoming); UNSW Law Research Paper No. 2015-19. Available at SSRN: https://ssrn.com/abstract=2601958 or http://dx.doi.org/10.2139/ssrn.2601958

Ross P. Buckley (Contact Author)

University of New South Wales (UNSW) - Faculty of Law ( email )

Sydney, New South Wales 2052
Australia

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