sovereign debt crisis have been driven mainly by weak growth prospects and heightened sovereign risk and to a lesser extent, by …

-term oriented, with high implicit capital, and low risk (thanks to the law of large numbers). Trading is transactions …-based: scalable, shortterm, capital constrained, and with the ability to generate risk from concentrated positions. When a bank …-ante. And a bank may use trading for risk-shifting. Financial development augments the scalability of trading, which initially …

of tools—developed at the IMF and externally—to identify the implications of interconnectedness in systemic risk and how …

Traditional bank competition policy seeks to balance efficiency with incentives to take risk. The main tools are rules … have structurally low charter values and high incentives to take risk. In such an environment, traditional policies that …

United Kingdom - are more promising while still entailing significant implementation challenges. A risk factor common to all … of the financial system. Since this could lead to accumulation of systemic risk if left unchecked, it appears unlikely …