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Banking in sentence

2429 examples of Banking in a sentence

If a full banking union proves impossible, it might be preferable to let the trend toward renationalization run its course.
English now seems to have reached the point of no return in its accelerating global expansion, competing with national languages in such diverse fields as popular music, transport, the Internet, banking, cinema and television, science, and sports.
Its GDP growth has slowed, but investment remains robust, and there is no strain on its banking system.
Thanks to international and national policy interventions, their currencies and banking systems were saved from collapse, but many of them saw massive output drops and soaring unemployment.
Badly regulated banking sectors, feeble market structures, and weak competition, as well as trade and current-account restrictions, were also among the shortcomings identified.
At the same time, the banking union, established by the EU in the wake of the 2007-2008 global financial crisis, should be strengthened by enlarging the capital base of the Single Resolution Fund and establishing a common deposit guarantee scheme.
Now it wants to socialize not only government debt by introducing Eurobonds, but also banking debt by proclaiming a “banking union.”
And essentially the same happened with US subprime mortgage lending and with the Spanish banking system in the 2000’s.
In Spain, the public debt-to-GDP ratio is 69%, but the debt of the Spanish banking system totals 305% of GDP, or about €3.3 trillion – about as much as the combined public debt of all five crisis-stricken eurozone countries.
While the enormous volume of the bank debt implies that governments should shy away from socializing banking risks, it also suggests that only the banks’ creditors could reasonably be asked to foot the bill without being overburdened.
Europe needs no banking union beyond a common regulatory system.
As a result, the crisis continued to develop and take on new forms, including, most dangerously, in the banking sector in Italy, the “fault line of Europe.”
Better than BaselROME – The Basel Accords – meant to protect depositors and the public in general from bad banking practices – exacerbated the downward economic spiral triggered by the financial crisis of 2008.
My recent study with Jacopo Carmassi, Time to Set Banking Regulation Right, shows that by permitting excessive leverage and risk-taking by large international banks – in some cases allowing banks to accumulate total liabilities up to 40, or even 50, times their equity capital – the Basel banking rules not only enabled, but, ironically, intensified the crisis.
After the crisis, world leaders and central bankers overhauled banking regulations, first and foremost by rectifying the Basel prudential rules.
The latest example highlighting this flaw is Dexia, the Belgian-French banking group that failed in 2011 – just after passing the European Banking Authority’s stress test with flying colors.
In order to overcome these shortcomings in international banking regulations, three remedies are needed.
The new capital ratio should be raised to 7-10% of total assets in order to dampen risk-taking by bankers and minimize the real economic impact of large-scale deleveraging following a loss of confidence in the banking system.
There would also be no need for special restrictions on banking activities and operations.
The most remarkable feature of the policy deliberations on prudential banking rules so far has been their delegation to the Basel Committee of Banking Supervisors and the banks themselves, both of which have a vested interest in preserving the existing system.
Tsipras and Varoufakis should have seen this coming, because the same thing happened two years ago, when Cyprus, in the throes of a banking crisis, attempted to defy the EU.
Now that major airlines have flights to and from the island, Cuban-Americans and any other tourists can travel there freely, which means that there are investment opportunities in hospitality, telecommunications, transportation, retail banking, and other related industries.
And denying Russian banks and firms access to the US (and possibly European) banking system – the harshest sanction applied to Iran – would have a devastating impact.
Moreover, Red Bonds could be conveniently ring-fenced so that they do not destabilize the banking system, thereby ensuring that the no-bailout clause that applies to them becomes a credible proposition.
But this has reduced these banks’ effectiveness as financial intermediaries, while encouraging the rise of shadow banking to circumvent the restrictions.
Still others highlight the role that the political system played in inflating the banking sector and real-estate prices, particularly the sub-prime sector.
In addition, regulators should require banks to issue an additional amount of capital – say, 10% – in the form of long-term debt that is forced to convert into equity if the bank and the overall banking system get into financial difficulty.
The capital backing the banks’ assets was only $1.4 trillion last fall, leaving the US banking system some $400 billion in the hole, or close to zero even after the government and private-sector recapitalization of such banks.
So, the US banking system is effectively insolvent in the aggregate; most of the British banking system looks insolvent, too, as do many continental European banks.
There are four basic approaches to cleaning up a banking system that is facing a systemic crisis: recapitalization of the banks, together with a purchase of their toxic assets by a government “bad bank”; recapitalization, together with government guarantees – after a first loss by the banks – of the toxic assets; private purchase of toxic assets with a government guarantee (the current US government plan); and outright nationalization (or call it “government receivership” if you don’t like the dirty N-word) of insolvent banks and their resale to the private sector after being cleaned.
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