Bank Capital Regulations Around the World: What Explains the Differences?

41 Pages Posted: 19 Jul 2016

See all articles by Gazi Kara

Gazi Kara

Board of Governors of the Federal Reserve System

Date Written: 2016-07

Abstract

Despite the extensive attention that the Basel capital adequacy standards have received internationally, significant variation exists in the implementation of these standards across countries. Furthermore, a significant number of countries increase or decrease the stringency of capital regulations over time. The paper investigates the empirical determinants of the variation in the data based on the theories of bank capital regulation. The results show that countries with high average returns to investment and a high ratio of government ownership of banks choose less stringent capital regulation standards. Capital regulations may also be less stringent in countries with more concentrated banking sectors.

Keywords: Capital Requirements, Basel Capital Accord, Financial regulation, International policy coordination

JEL Classification: G21, G28, F33

Suggested Citation

Kara, Gazi, Bank Capital Regulations Around the World: What Explains the Differences? (2016-07). FEDS Working Paper No. 2016-057. Available at SSRN: https://ssrn.com/abstract=2811561 or http://dx.doi.org/10.17016/FEDS.2016.057

Gazi Kara (Contact Author)

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
283
rank
104,811
Abstract Views
987
PlumX Metrics