Home  Journals  Finance and Credit  42(618) - 2014 November

On the need of introduction of international standards in banking activity

Available online: 3 November 2014

Subject Heading: Banking

JEL Classification: 

Pages: 13-19

The article considers that global financial crisis made even more actual numerous appeals on behalf of scientists and experts to toughen the regulations of banking institutions activity in order to increase their stress resistance to various manifestations of market instability. Reaction to such proposals in the different countries is ambiguous, since more rigid requirements to banking capital are capable to reduce availability of credits, and may lead to price rise of banking credits, and in its turn, it will interfere with economic growth. Absolutely all global economies try to achieve stimulation this global growth. The author claims that in this regard, it necessitates the post-crisis development of new economic paradigm. On the one hand, the monetary authorities need to pursue policy of quantitative easing in order to "satiate" economy with cheap money that in the near future will stimulate the increase of population consumption, and it will reduce risks of a deflation. On the other hand, it is necessary to solve a problem which escalated in banking sector: the policy of quantitative easing compels banks to look for new mechanisms and tools, which provide the due level of their business profitability. In this regard, risks of banks investment in high-risk assets and threat of new "bubbles" in economy, which removal may lead to new cycles of economic recession and manifestation of the crisis phenomena, considerably increase. The need of the stage-by-stage, unified regulation of the banking sector is traced and acknowledged by absolutely all market participants in a context of new economic threats to increase its stability and transparency. More rigid standards of risk management may lead to decrease in risk of bankruptcy of separate banks and will reduce financial institutions interdependence that in their turn will reduce the probability of emergence of chain reaction in case of problems of the specific participant of the financial market, and it will allow to get rid of the threat of financial instability for the market as a whole. The article makes an analysis of consequences of the international banking community transition to the Basel-3 standards, and it describes the main objectives, criteria and parameters of this agreement. The paper also identifies the directions of new standards structuring. The author considers the trends and problems of their introduction in the Russian Federation banking system. The author comes to a conclusion about the importance and necessity to use the unified international standards of financial sector regulation.

Keywords: liquidity, funding, financial market, leverage, systemically significant company, capital sufficiency, anti-cyclic buffer

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