Ever since the Asian Financial Crisis, concerns have risen over whether policy-makers have sufficient tools to maintain financial stability. The ability to predict financial disturbances enables the authorities to take precautionary action to minimize their impact. In this context, the...

"Current research is beginning to question the role and effectiveness of traditional rules-based bank regulatory oversight in favor of incentive-compatible regulatory design and market discipline and, in particular, mandatory subordinated debt market discipline. However, research on the...