Financial Failures and Risk Management
AbstractFinancial failures observed during global financial crisis have again underlined the importance of effective risk management. In this article, the author analyzes the best instrument, namely self discipline, official discipline and market discipline, for the effective risk management. In the light of literature review and lessons of firm/system wide financial failures, we also analyze degree of efficieny of disciplinary methods. We first conclude, however it may not provide optimal solutions to the risk management problems of financial intermediaries, better risk management standards should be developed. We also conclude that firm wide risk management processes may be managed by pragmatic regulatory policies without get into negative impacts of market mechanism and big financial firms’ pressures.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 40594.
Date of creation: 08 Aug 2012
Date of revision:
Publication status: Published in Sermaye Piyasası Dergisi 10 (2): 100-109. 10 (2).2(2012): pp. 100-109
Financial failure; risk management; regulation; self regulation;
Find related papers by JEL classification:
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
- G01 - Financial Economics - - General - - - Financial Crises
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
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