Stress Testing of Banks in the USA

Банкивська система будь-яко'1' держсви с склсдовою ii економгчно'1 системи, тому eid ii безперебийного тс ефективного функционування залежить стсбiльнiсть всШ национально'1' економики. З огляду нс глобализацию економичних вiдносин, сьогоднi eid стсбiльностi банювського сектору США зслежить стсбiльнiсть банювських систем инших крат з видкритою ринковою економикою, як мсють мж собою тисни фiнснсовi зв 'язки. Мета стсттi - розкрити особливостi здшснення стрес-тестування банюв у США та оцинити динамику стсбiльностi банювсько'1' системи цШ крати протягом остантх 20 рокив. Стрестестування банюв у США здийснюсться задля виявлення i вимирювання вразливости банювського сектору щодо шокових макроекономичних подий у нацюнальнш i свитовий економици. Дане дослидження побудовано на аналз динамики чотирьох показниюв: коефициснта чутливости капиталу, индексу чутливости до вимушеного швидкого продажу активив, коефициснта ликвидности для стрес-сценарив, показника чутливости до втрати ликвидности та платоспроможности. Виявлено, що найбильш нестабильною банювська система США була у кризови 2008-2009 роки, коли банки зазнали значних втрат через ризикову кредитну политику. Посткризове регулювання капиталу та ликвидности, завдяки виважений полтици Федерально'1'резервно'1' системи, призвело до багатьох наступних роюв стабильности. Банкам довелося також застосовувати антикризови заходи регулювання у «ковидний» 2020 рик i ци заходи принесли позитивни результати. Шокови поди не вплинули на стабильнисть банювсько'1' системи США, але видобразилися на обсязи готивкових коштив. Послаблення антикризових заходив у 2021 роци спричинило деяке зростання показниюв, що розраховуються при стрестестувант, однак, це не призвело до дестабшзацп банювсько'1' системи.Alternate abstract:The banking system of any state is a component of its economic system. Therefore the stability of the entire national economy depends on its smooth and effective functioning. Given the globalization of economic relations today, the stability of the banking systems of other countries with open market economies, which have close financial ties, depends on the stability of the US banking sector. The purpose of the article is to reveal the features of stress testing of banks in the USA and to assess the dynamics of the stability of the banking system of this country over the past 20 years. Stress testing of banks in the USA is carried out to identify and measure the banking sector's vulnerability to shock macroeconomic events in the national and global economy. This study is based on the analysis of the dynamics of four indicators: the capital sensitivity coefficient, he sensitivity index to the forced quick sale of assets, the liquidity coefficient for stress scenarios, and the sensitivity index to the loss of liquidity and solvency. It was revealed that the US banking system was most unstable during the 2008-2009 crisis when banks suffered significant losses due to risky credit policies. Post-crisis regulation of capital and liquidity, thanks to the balanced policy of the Federal Reserve System, led to many subsequent years of stability. Banks also had to apply anti-crisis regulatory measures in the "covid" 2020 year, and these measures brought positive results. The shock events did not affect the stability of the US banking system but were reflected in the amount of cash. The loosening of anti-crisis measures in 2021 caused some growth in the indicators calculated during stress testing. However, it did not lead to the destabilization of the banking system.

OVERVIEW OF THE PURPOSE OF INTERNATIONAL BANKING AGREEMENTS

The beginning of this stage was marked by institutions that significantly influenced the banking activity: the Institute for International Finance, the Bank for International Settlements, the Cooke Committee and other supervisory groups, the Community Contact Group European Economic Community (Contact Group of the European Economic Community), joined by the International Monetary Fund (IMF), the World Bank, the Paris Club and the advisory committees of private banks. With regard to international financial cooperation, the idea was supported that cooperation in this field could be conceptualized as a product of power and purpose;in particular, the combination of power in the US (and to a lesser extent British) financial market with the common or convergent purpose of banking supervisors to provide greater financial stability to their home markets while addressing competitive concerns In all situations, a cooperation based on harmonization between the multitude of concepts and knowledge acquired indirectly increases, as stated, the probability of general stability in the international banking system6. In 1977, the EEC Council of Ministers adopted the First Banking Coordination Directive, which set out the minimum authorization criteria for credit institutions, the uniform calculation of prudential solvency and liquidity rates (initially for observational purposes only) and details of the Advisory Committee. banking role to support further coordination efforts. [...]in 2021, the European Commission will adopt a revision of EU banking rules (the Capital Requirements Regulation and the Capital Requirements Directive), which are important for banking reform, both for Europe's recovery from the COVID-19 pandemic and for the transition to climate neutrality.

The public policy of sanctions compliance: A need for collective and coordinated international action

This paper sets out to explain the challenges of aligning sanctions compliance efforts with the delivery of humanitarian aid into highly sanctioned environments. It highlights that while the policy of sanctioning authorities is to encourage and permit humanitarian activity, there remain significant obstacles to achieving this objective. The paper offers insights into the key areas of complexity and the most urgent aspects requiring clarification. It expressly illustrates that striking the correct balance between the delivery of critical humanitarian responses and the application of United Nations and unilateral sanctions will necessitate some realignment. The paper concludes by highlighting the need for governments and sanctioning authorities to adopt a forward-leaning approach, and by stressing the necessity of collective and coordinated international action.

Financial spillovers, spillbacks, and the scope for international macroprudential policy coordination

This paper discusses the scope for international macroprudential policy coordination in a financially integrated world economy. It begins with a review of the transmission channels associated with, and the empirical evidence on, financial spillovers and spillbacks. Limitations of the existing literature are also identified. The potential gains associated with cross-border macroprudential coordination, dwelling on both recent analytical contributions and quantitative studies based on multi-country models with financial frictions, are then evaluated. The issue of whether coordination of macroprudential policies simultaneously requires some degree of monetary policy coordination is also discussed. The analysis focuses on the potential for policy coordination between major advanced economies and a group identified as systemically-important middle-income countries (SMICs). Next, practical ways to promote international macroprudential policy coordination are considered. Following a discussion of Basel III’s Principle of reciprocity and ways to improve it, the paper advocates a further strengthening of the current statistical, empirical and analytical work conducted by international financial institutions to evaluate, and raise awareness of, the gains from international coordination of macroprudential policies.