Page 29 - Banking Finance May 2023

ARTICLE

GLOBAL

REGULATORY

PRIORITIES

inancial regulations refer to a form of regulation when something goes wrong. When a bank fails due to its
F or supervision of financial markets and institutions. inability to meet its obligation towards depositors or other
financial regulations
Though
creditors, the effect can spread to the wider
its
and
implementation have been among the key
functions in any economy, It was only after the 2008 economy.Financial regulations aim to enforce applicable
laws, prosecute cases of market misconduct, license
financial crisis where regulators took aggressive action providers of financial services, protect clients, investigate
towards regulating the financial markets in a more prudent complaints, and maintain confidence in the financial system.
manner. Governments around the world were authorized
to make global markets safer by providing transparency of The Challenge:The prospects for sustaining the global
transactions in order to stabilize the financial system. One recovery that characterised the year 2021 on the back of
of the key purposes of establishing financial regulations is unprecedented policy stimulus and rapid pace of
to maintain the integrity of the financial system. vaccinations have been dimmed by the Russia-Ukraine war
and synchronized and front-loaded monetary policy
We all depend on the financial system-from saving and tightening in the face of surging global inflation. With
accessing money, borrowing money to maintain business, persisting concerns about the near-term inflation outlook,
taking out mortgage or insurance, to getting claims paid amplified market volatility is raising financial stability risks.
During these difficult times, higher capital and liquidity
About the author buffers have helped banks and financial institutions to
remain resilient and stable. Nonetheless, fears of a hard
Kalicharan Das landing have increased worldwide. For emerging market
Chief Manager, faculty economies, these factors have translated into surges in
ULA, Credit & Policy
capital outflows, sharp depreciation of exchange rates, loss
Union Bank of India
of reserves and darkening macroeconomic prospects.
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