Title Liberalization, prudential supervision, and capital requirements : the policy trade-offs / prepared by Elina Ribakova

Published Washington, D.C. : International Monetary Fund, European Dept., ©2005

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Description 1 online resource (14 pages) : illustrations Series IMF working paper ; WP/05/136 IMF working paper ; WP/05/136. Contents Contents -- I. INTRODUCTION -- II. FINANCIAL LIBERALIZATION AND IMPERFECT SUPERVISION -- III. CONCLUSION -- References Summary While deregulated financial markets and strong competition are commonly viewed as prerequisites for successful economic development, recent empirical evidence suggests that financial liberalization, if not well phased, can lead to costly financial crises. This paper focuses on the roles of minimum capital requirements and prudential supervision in promoting financial stability during financial liberalization. The paper extends the Hellmann, Murdock, and Stiglitz model to analyze the effects of prudential supervision and demonstrates the trade-off between the quality of supervision and the level of minimum capital requirements. Where prudential supervision is poor, higher capital requirements are optimal Notes "July 2005." Bibliography Includes bibliographical references (pages 12-14) Notes English Online resource; title from title screen (viewed July 17, 2008) Subject International finance -- Econometric models Finance -- Government policy -- Econometric models Capital movements -- Econometric models Banks and banking -- State supervision -- Econometric models Capital movements -- Econometric models International finance -- Econometric models Form Electronic book Author International Monetary Fund. European Department, issuing body. ISBN 1283512505 9781283512503 9781451906912 1451906919 1462367992 9781462367993 1452780439 9781452780436 9786613824950 661382495X

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