Mirtchev, A. (2012, March 29). Will Financial Regulation Trash Global Economic Security? Forbes.
Under the auspices of the Financial Stability Board, more than 30 recommendations have been set out as part of a massive and far-reaching G-20 financial regulatory reform package to ostensibly minimize risk in the financial system and maximize consumer protection.
The new measures fall into several broad categories, including: 1) surveillance (systemic risk boards) 2) bank capital and liquidity (Basel III standards tightening the rules on the ratio of bank deposits to lending); 3) too big to fail (new thresholds for those designated as Systemically Important Financial Institutions); 4) capital markets (new requirements surrounding OTC derivative activity and the role of credit rating agencies); 5) compensation standards; and 6) reduced opportunities for regulatory arbitrage particularly with regard to the so-called shadow banking system.