The Risks of Financial Institutions

Dice Center Working Paper No. 2005-13

34 Pages Posted: 16 Jun 2005

See all articles by René M. Stulz

René M. Stulz

Ohio State University (OSU) - Department of Finance; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI)

Mark Carey

Board of Governors of the Federal Reserve - Division of International Finance (IFDP) - International Banking Section

Multiple version iconThere are 2 versions of this paper

Date Written: June 2005

Abstract

Over the last twenty years, the consensus view of systemic risk in the financial system that emerged in response to the banking crises of the 1930s and before has lost much of its relevance. This view held that the main systemic problem is runs on solvent banks leading to bank panics. But financial crises of the last two decades have not fit the mold. A new consensus has yet to emerge, but financial institutions and regulators have considerably broadened their assessment of the risks facing financial institutions. The dramatic rise of modern risk management has changed how the risks of financial institutions are measured and how these institutions are managed. However, modern risk management is not without weaknesses that will have to be addressed.

JEL Classification: G2, G21, G22, G28, G10, D81

Suggested Citation

Stulz, Rene M. and Carey, Mark, The Risks of Financial Institutions (June 2005). Dice Center Working Paper No. 2005-13. Available at SSRN: https://ssrn.com/abstract=743130 or http://dx.doi.org/10.2139/ssrn.743130

Rene M. Stulz (Contact Author)

Ohio State University (OSU) - Department of Finance ( email )

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HOME PAGE: http://www.cob.ohio-state.edu/fin/faculty/stulz

National Bureau of Economic Research (NBER)

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European Corporate Governance Institute (ECGI)

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Mark Carey

Board of Governors of the Federal Reserve - Division of International Finance (IFDP) - International Banking Section ( email )

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Washington, DC 20551
United States
202-452-2784 (Phone)
202-452-5295 (Fax)

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