Many of the world's developed economies have introduced, or are planning to introduce, bank bail-in regimes. Both the planned EU resolution regime and the European Stability Mechanism Treaty involve the participation of bank creditors in bearing the costs of bank recapitalization via the bail-in...

The chapter reconceptualizes financial innovation. In this context, it discusses the risks of financial innovation and contemporary regulatory reforms addressing those risks. It provides a critique of contemporary reforms. Finally, it stresses the need for a new framework to regulate financial...

Turbulence in foreign exchange markets and currency dumping/manipulation cultivate further mistrust in international economic relations. At the same time, both phenomena could potentially prove to be a cause of systemic risk. For example, foreign currency exposures were a key vulnerability...

Weaknesses in warehousing systemic risk in modern Financial Market Infrastructure (FMI) are the result of a combination of market failures and of structural flaws deeply ingrained in modern financial markets. The same applies to investor control over their investments over the custodial chain....

Few experts predicted the Asian Financial Crisis of 1997-1998, or the Global Financial Crisis of 2008 and its close companion the Eurozone Debt Crisis of 2010, and we certainly do not pretend to be able to predict the next one. Yet history teaches there will be another crisis and probably sooner...

High leverage levels can lead to virtually limitless expansion of bank asset size, which maximizes, in the short to medium term, banks' return on equity. In the absence of regulatory controls on leverage, all it takes to assume excessive risks, even for benign bankers, is to imitate competitor...

EC securities regulation has been one of the cornerstones of all policy initiatives aiming at the integration of EU financial markets. Yet the development of this body of EC law has been a very lengthy process frequently marred by controversy. Arguably, a marked lack of direction has been its...

A large body of empirical and experimental literature provides convincing evidence of the complexity of individual and institutional investor behavior in market environments. This complexity raises serious questions regarding the effectiveness of current systems of investor protection...

The evolving merger of payments technology with technology underpinning investment markets' infrastructure can have a great impact on the mode of supply of financial services, notwithstanding technical, legal and regulatory restrictions. One-stop-shop multi-purpose and multi-asset platforms will...