By Central Bank News
Developing nations fear that credit and liquidity in their markets will dry up as major international banks struggle to meet tougher global rules, the Financial Stability Board said.
In a report on the effect on emerging markets from Group of 20-led regulatory reforms, the FSB said some developing economies were worried that higher capital requirements levied on major international banks could have unintended consequences, both on their own financial markets and domestic banks.
The FSB, which carried out a study with the International Monetary Fund (IMF) and World Bank, also found that emerging economies were concerned over a “home bias” in the design or implementation of the reforms that would have adverse effects on their own financial institutions.
Click to read: Identifying the Effects of Regulatory Reforms on Emerging Market and Developing Economies: A Review of Potential Unintended Consequences.
