Rethinking Market Discipline in Banking : Lessons from the Financial Crisis

Stephanou, Constantinos

关键词: ACCOUNTING;    ACCOUNTING RULES;    ACCOUNTING STANDARDS;    AGENCY PROBLEMS;    AMOUNT OF DEBT;   

DOI  :  10.1596/1813-9450-5227
RP-ID  :  WPS5227

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

The main objective of this paper is torethink the use of market discipline for prudential purposesin light of lessons from the financial crisis. The paperdevelops the main building blocks of a market disciplineframework, and argues for the need to take an expansive viewof the concept. It also illustrates using actualbank casestudies from the United States its apparent failures in thecrisis, particularly the failure to prevent the buildup ofsystemic, as opposed to idiosyncratic, risks. However, whilethe role of market discipline in the design ofmacro-prudential regulation appears to be largelyconstrained, more can be done on the micro-prudential sideto promote clearer market signals of bank riskiness and toencourage their use in the supervisory process.