Better Banking – Understanding and Addressing the Failures in Risk Management, Governance and Regulation

The book gives an overview of some of the key developments and concepts in modern banking. Examples of these include the definition of a common set of rules since the end of 1980s (the Basel regulations already in their 3rd version), the definition of capital and the basics of risk management. Whilst some of these are supposedly well understood, and referred to frequently in the public debate, the authors set out a clearer perspective, highlighting the takeaways from the current crises and challenging conventional wisdom.The core topic will be a hypothesis that current industry structure and revised regulations are only a partial response to the weaknesses in the banking system revealed by the crisis. Indeed, they may have negative impacts in some areas. Having described and argued this hypothesis, the authors will set out a manifesto for improvements to the banking industry - and highlight some of the crucial conflicts that may remain. This is what the reference to Basel 4, when regulators and policy makers are currently working on the finalization and implementation of Basel 3, wishes to capture.