Implications of Basel II for financial stability. Clouds are darker for developing countries
DOI:
https://doi.org/10.13133/2037-3643/9879Keywords:
Developing Countries, Policy, RegulationAbstract
Placing Basel II in the perspective of the more general trend in financial regulation, the paper analyses its efficacy and efficiency as a device to foster financial resiliency. In assessing the criticisms levelled against the New Accord, special attention is devoted to the case of the emerging countries. I suggest that Basel II is neither a sufficient, nor a necessary condition to attain systemic financial stability, especially in weak institutional and macro-policy environments. Taking also into account just how complex and onerous the scheme is, I conclude that the emerging countries should look for new international institutional arrangements based on the principle of astability level playing field.
JEL Codes: G21, G28, O16, P34
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