Internationally active banks can be a source of systemic risk as a default of one bank can easily spill over to banks in other countries. This implies that financial market stability in one country influences stability in another country. For this reason, different countries should have an incentive to cooperate. However, regulation and supervision of banks are still more present on the national than on the supranational level. On the one hand, the recent crisis has shown that regulation and supervision limited to the national level are not sufficient to prevent financial instabilities. On the other hand, different countries are very heterogeneous. For this reason, it will not be possible to align supranational regulation and supervision with banking sector specific characteristics of individual countries. The following research papers are focusing on how to implement regulation and supervision across countries. Thereby, they also discuss the tradeoff regarding regulation and supervision on the national and supranational level.
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Working and discussion papers
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Bussière, M., R. Hills, S. Lloyd, B. Meunier, J. Pedrono, D. Reinhardt, and R. Sowerbutts (2020). Le Pont de Londres: interactions between monetary and prudential policies in cross-border lending. Bank of England Working Paper No. 850.
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Walther, A. and L. White (2019) Rules versus Discretion in Bank Resolution. CEPR Discussion Paper No. DP14048
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Beck, T. (ed.) (2012). Banking union for Europe – Risks and challenges. VoxEU eBook.
Beck,T., W. Wagner, and R. Todorov (2012). Cross-border banking and national supervision – is there a conflict? www.voxeu.org.
Bremus, F., and C. Lambert (2014). Banking union and bank regulation: Banking sector stability in Europe. DIW Economic Bulletin 4(9): 29-39.
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Hills, R., D. Reinhardt, R. Sowerbutts and T. Wieladek (2016). Cross-border regulatory spillovers: How much? How important? What sectors? Lessons from the United Kingdom. BoE Staff Working Paper No. 595.
Ichiue, H. ; Frederic Lambert (2016). Post-crisis International Banking : An Analysis with New Regulatory Survey Data. IMF Working Paper No. 16/88.
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