Banking Regulation in Times of Crisis

An Economic Analysis from Turkey and Russia

By Deniz Akun Ergun

During and after the 2007-2009 global financial crisis, emerging market economies displayed remarkable resilience and maintained robust rates of economic growth. Learning from the lessons of the crises of the past 15 years, developing countries have adopted measures to become less vulnerable to the external shocks that are likely to emerge from more developed countries. Academics and policymakers have focused on the construction of an appropriate regulatory and supervisory framework for the banking sector. Banks were engaging in excessive risk taking during the global crisis. Prudential banking regulation and supervision have been designed with the aim of curbing excessive risk taking by banks, because engaging in excessive risky transactions is the ultimate source of instability. Hence, banking regulation is needed to deal with the failure of markets to police banks' risky behaviors. This book discusses the impact of regulations and supervision on banks' performance, focusing on two emerging market economies: Turkey and Russia. It examines, from a law and economics perspective, the way in which regulations matter for financial stability and banking performance. It takes up the debate on the efficiency of certain solutions and approaches to banking regulation in the context of emerging countries. (Series: European Studies in Law and Economics - Vol. 17) [Subject: Law and Economics, Financial Law, Banking Law]

Publication Date: 3/30/2015
Format: Paper
ISBN: 9781780683003

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