{
  "title": "Creating a Safer Financial System: Will the Volcker, Vickers, and Liikanen Structural Measures Help?",
  "publication": "Staff Discussion Notes, May 14, 2013",
  "sourceUrl": "https://www.imf.org/en/publications/staff-discussion-notes/issues/2016/12/31/creating-a-safer-financial-system-will-the-volcker-vickers-and-liikanen-structural-measures-40526",
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  "summary": "The U.S., the U.K., and more recently, the E.U., have proposed policy measures directly targeting complexity and business structures of banks. Unlike other, price-based reforms (e.g.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- The U.S., the U.K., and the E.U. have proposed policy measures directly targeting complexity and business structures of banks.\n- These structural proposals differ from price-based reforms (e.g., Basel 3 and G-SIFI surcharges).\n- The proposals have been developed unilaterally with material differences in scope, design and implementation schedules.\n- Unilateral differences may exacerbate cross-border regulatory arbitrage and increase burdens on consolidated supervision and cross-border resolution.\n- The paper analyzes potential implications of implementing different structural policy measures and proposes a pragmatic and coordinated approach to reduce regulatory arbitrage and minimize unintended consequences.\n- The paper aims to identify a set of common policy measures that countries could adopt to re-scope bank business models and corporate structures."
    },
    {
      "heading": "Major findings and implications",
      "content": "- Structural measures target bank complexity and business structures rather than price-based capital and surcharge instruments.\n- Material differences in scope, design, and implementation schedules across jurisdictions create risks of:\n  - Cross-border regulatory arbitrage.\n  - Increased burden on consolidated supervision.\n  - Greater challenges for cross-border resolution.\n- A coordinated approach is needed to mitigate these risks and minimize unintended consequences when implementing structural reforms."
    },
    {
      "heading": "Policy recommendations and proposed approach",
      "content": "- Propose a pragmatic and coordinated approach to development of structural policies.\n- Identify a set of common policy measures that countries could adopt to:\n  - Re-scope bank business models.\n  - Re-scope corporate structures.\n- Aim to reduce risk of regulatory arbitrage and minimize unintended consequences through coordination."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Authors: José Vinãls, Ceyla Pazarbasioglu, Jay Surti, Aditya Narain, Michaela Erbenova, Julian T Chow\n- Date: May 14, 2013\n- Series: Staff Discussion Notes No. 2013/004\n- Issue: 004\n- Volume: 2013\n- Pages: 27\n- DOI: https://doi.org/10.5089/9781484340943.006\n- ISBN: 9781484340943\n- ISSN: 2617-6750\n- Subject: Bank resolution; Banking; Financial crises; Financial regulation and supervision; Financial sector policy and analysis; Macrostructural analysis; Market risk; Structural reforms; Systemic risk\n- Keywords: Bank business models; bank resolution; Bank resolution; capital; EU bank; financial system; Global; groupwide bank risk management; least cost resolution; loss experience; market risk; resolvability assessment; risk reduction; SDN; structural measures; Structural reforms; Systemic risk\n\nStaff Discussion Note authored by José Vinãls et al., \"Creating a Safer Financial System: Will the Volcker, Vickers, and Liikanen Structural Measures Help?\", Staff Discussion Notes 2013, 004 (2013).\n\n---\n\n Content in this bundle\n\n- sdn1304\n  - sdn1304 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - sdn1304 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/staff-discussion-notes/issues/2016/12/31/creating-a-safer-financial-system-will-the-volcker-vickers-and-liikanen-structural-measures-40526"
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    "Authors: José Vinãls, Ceyla Pazarbasioglu, Jay Surti, Aditya Narain, Michaela Erbenova, Julian T Chow",
    "Published: May 14, 2013",
    "Series: Staff Discussion Notes",
    "DOI: https://doi.org/10.5089/9781484340943.006",
    "The U.S., the U.K., and the E.U. have proposed policy measures directly targeting complexity and business structures of banks.",
    "These structural proposals differ from price-based reforms (e.g., Basel 3 and G-SIFI surcharges).",
    "The proposals have been developed unilaterally with material differences in scope, design and implementation schedules.",
    "Unilateral differences may exacerbate cross-border regulatory arbitrage and increase burdens on consolidated supervision and cross-border resolution.",
    "The paper analyzes potential implications of implementing different structural policy measures and proposes a pragmatic and coordinated approach to reduce regulatory arbitrage and minimize unintended consequences.",
    "The paper aims to identify a set of common policy measures that countries could adopt to re-scope bank business models and corporate structures.",
    "Structural measures target bank complexity and business structures rather than price-based capital and surcharge instruments.",
    "Material differences in scope, design, and implementation schedules across jurisdictions create risks of:",
    "A coordinated approach is needed to mitigate these risks and minimize unintended consequences when implementing structural reforms.",
    "Propose a pragmatic and coordinated approach to development of structural policies.",
    "Identify a set of common policy measures that countries could adopt to:",
    "Aim to reduce risk of regulatory arbitrage and minimize unintended consequences through coordination.",
    "Authors: José Vinãls, Ceyla Pazarbasioglu, Jay Surti, Aditya Narain, Michaela Erbenova, Julian T Chow",
    "Date: May 14, 2013",
    "Series: Staff Discussion Notes No. 2013/004",
    "Issue: 004",
    "Volume: 2013",
    "Pages: 27",
    "DOI: https://doi.org/10.5089/9781484340943.006",
    "ISBN: 9781484340943",
    "ISSN: 2617-6750",
    "Subject: Bank resolution; Banking; Financial crises; Financial regulation and supervision; Financial sector policy and analysis; Macrostructural analysis; Market risk; Structural reforms; Systemic risk",
    "Keywords: Bank business models; bank resolution; Bank resolution; capital; EU bank; financial system; Global; groupwide bank risk management; least cost resolution; loss experience; market risk; resolvability assessment; risk reduction; SDN; structural measures; Structural reforms; Systemic risk",
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