Do We Need a Separate Banking System? An Assessment
Motivated by the current discussion on different separate banking systems, we provide an overview and assessment of the different proposed systems and outline their potential effects on systemic stability and the German banking sector. The results show that the various separate banking systems only play a minor role in reducing and limiting systemic risk. They only marginally contribute to solving conflicts of interest and can even be detrimental to banking business diversification. A separate banking system could, however, facilitate banking supervision and banking resolution by reducing the banking system’s complexity. Furthermore, credible threats to not support investment banks with federal resources in times of crisis could lead to a more adequate incentives structure of suppliers of equity and debt capital. More efficient measures to further reduce systemic risk in the financial sector should, however, use different levers, such as additional minimum regulatory capital requirements.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Adrian Blundell-Wignall & Gert Wehinger & Patrick Slovik, 2009. "The elephant in the room: The need to deal with what banks do," OECD Journal: Financial Market Trends, OECD Publishing, vol. 2009(2), pages 1-27.
- Schröder, Michael & Borell, Mariela & Gropp, Reint & Iliewa, Zwetelina & Jaroszek, Lena & Lang, Gunnar & Schmidt, Sandra & Trela, Karl, 2012. "The role of investment banking for the German economy: Final report for Deutsche Bank AG, Frankfurt/Main," ZEW Dokumentationen 12-01, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
When requesting a correction, please mention this item's handle: RePEc:kuk:journl:v:46:y:2013:i:3:p:331-355. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Credit and Capital Markets)
If references are entirely missing, you can add them using this form.