A prolegomenon to future capital requirements
Bank supervisors have made significant strides since 1980 in the area of capital requirements, and they are currently pursuing further refinements. This article looks beyond such developments at longer term supervisory goals. Abstracting to some extent from the current regulatory framework, the author attempts to delineate a set of fundamental principles for future work on capital requirements. He distinguishes minimum capital--an objective standard imposed by regulators across firms--from optimum capital--a subjective standard adopted by individual firms to cover their own risks-- and shows how the two concepts can form the basis for a general supervisory approach to capital.
Volume (Year): (1995)
Issue (Month): Jul ()
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- Franklin R. Edwards & Frederic S. Mishkin, 1995.
"The decline of traditional banking: implications for financial stability and regulatory policy,"
Economic Policy Review,
Federal Reserve Bank of New York, issue Jul, pages 27-45.
- Franklin R. Edwards & Frederic S. Mishkin, 1995. "The Decline of Traditional Banking: Implications for Financial Stabilityand Regulatory Policy," NBER Working Papers 4993, National Bureau of Economic Research, Inc.
- White, Lawrence J, 1989. "The Reform of Federal Deposit Insurance," Journal of Economic Perspectives, American Economic Association, vol. 3(4), pages 11-29, Fall.