Teacher: Student

UNIVERSITY OF KRAGUJEVAC
FACULTY OF ECONOMICS

Seminar paper from the subject

Banking





Regulations and Supervision of Banks

Teacher:	Student:
Prof. Nenad Tomic	Zarifjon Khatamov

Kragujevac, December 2021

Contents

1. 
   Introduction…………………………………………………….3
   
2. 
   Main body:
   

1. 
   Regulation and its types………………………………………..4
   
2. 
   Regulations on bank activities………………………………….6
   
3. 
   Supervison………………………………………………………7
   

3. 
   Conclusion………………………………………………………12
   

1. 
   Introduction.
   

Banking systems that do not work well stymie economic progress, aggravate poverty, and destabilize economies. In particular, a large body of research shows that well-functioning banks boost economic growth, which reduces poverty. Furthermore, in recent decades, there have been an extraordinary number of disruptive banking crises.
The magnitude of recent crises, combined with evidence of banking systems' positive effects on economic growth, has prompted calls for bank regulation and supervisory reforms. The International Monetary Fund and the World Bank have endorsed the Basle Committee on Bank Supervision's wide list of "best practices" for bank regulation and supervision. There is a significant belief that bank "safety and soundness" would improve if policymakers in countries around the world implemented specific regulatory and supervisory methods, hence fostering growth and stability.
There is no evidence, however, that the best practices currently being advocated by international agencies are the best ones for promoting well-functioning banks. There is no evidence that successful practices in the United States, for example, will succeed in countries with different institutional and political environments. There is no evidence, moreover, that each regulatory and supervisory practice can be considered as part of an extensive checklist of desirable best practices in which more checks are better than fewer as opposed to considering regulation and supervision as reflecting broad views about the role of government in society. There is no comprehensive evidence on which regulatory and supervisory measures are most effective in promoting bank development, efficiency, and stability across countries. In the next chapters, we will cover bank regulation and supervision and provide key information on these topics.