Good Governance Curbs Excessive Bank Risks

2017-04-14T01:52:30-04:00October 16, 2014|

By Luis Brandão-Marques, Gaston Gelos, and Erik Oppers 

The global financial crisis reminded us that banks often take risks that are excessive from society’s point of view and can damage the economy. In part, this is the result of the incentives embedded in compensation practices and of inadequate monitoring by stakeholders.  Our analysis found the right policies could reduce banks risky behavior. 

Our findings

In our latest Global Financial Stability Report we take stock of recent developments in executive pay, corporate governance, and bank risk taking, and conduct a novel empirical analysis.

[…]

Time Waits for No Man: How to Secure Financial Stability in 2011

2017-04-15T14:30:02-04:00January 25, 2011|

So, where does the global financial system stand at the moment? Yes, we have witnessed improvements recently, but we are also observing a dichotomy between the economy and the financial system. While the global economic recovery has been continuing, financial stability is still at risk, because of a persistent lack of investor confidence in some advanced country sovereigns and their banking systems. In this post José Viñals reflects on the IMF’s updated assessment of global financial stability, including the key challenges that keep global financial stability at risk and the policies needed to meet these challenges.
Go to Top