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The Economics of Capital Regulation in Financial Conglomerates

Oxford Financial Research Center Working Paper No. 2002-FE-08

17 Pages Posted: 18 Oct 2002  

Alan D. Morrison

University of Oxford - Said Business School; University of Oxford - Merton College

Date Written: August 2002

Abstract

Financial conglomerates combine banking, insurance and other financial services within a single corporation. In this non-technical paper I consider the rationale for capital regulation in such firms and I examine some current policy questions in the light of this discussion. My first conclusion is that the different institutional structure of bank and insurance companies mitigates against harmonisation of capital requirements across different conglomerate businesses. I also question the received industry view that regulators should account for diversification effects at the holding company level.

Suggested Citation

Morrison, Alan D., The Economics of Capital Regulation in Financial Conglomerates (August 2002). Oxford Financial Research Center Working Paper No. 2002-FE-08. Available at SSRN: https://ssrn.com/abstract=331040 or http://dx.doi.org/10.2139/ssrn.331040

Alan Morrison (Contact Author)

University of Oxford - Said Business School ( email )

Department of Finance
Park End Street
Oxford OX1 1HP
United Kingdom
+44 18 6527 6343 (Phone)
+44 18 6527 6310 (Fax)

University of Oxford - Merton College

Merton Street
Oxford OX1 4JD
United Kingdom
+44 18 6527 6343 (Phone)

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