Financial Turmoil in the Banking Sector and the Asian Lamfalussy Process: The Case of Four Economies

Chen-Min Hsu and Chih-Feng Liao
Additional contact information
Chen-Min Hsu: Asian Development Bank Institute

Finance Working Papers from East Asian Bureau of Economic Research

Abstract: This paper investigates the prevailing financial regulatory structures and impact of the current financial turmoil on banking performance in four Asian economies : the People's Republic of China (PRC); Hong Kong, China; Singapore; and Taipei,China. Both the PRC and Hong Kong, China operate under a fragmented financial regulatory structure, while Singapore and Taipei,China have integrated structures. We examine the role of an integrated financial regulatory structure in helping financial institutions mitigate the impact of the financial crisis, using financial indicators of banks capital structure and operating performance in these four economies between 2003 and 2008. Our analysis of the indicators reveals that banking performance under a fragmented financial regulatory structure is not worse than under integrated regulation. This implies that financial regulatory structure is not the main reason why Asian financial institutions suffered only limited losses from the current global financial crisis. However, given the growing complexity of the global financial system, and the relative weakness of current financial regulatory structures in Asia, this paper suggests that East Asian governments should refer to the Lamfalussy Process in the European Union and set up an Asia Financial Stability Dialogue to facilitate policy coordination for regional financial sector stability and development.

Keywords: China; Hong Kong; Singapore; Taiwan; financial regulatory structures; Banking; finance; Asia Financial Stability Dialogue (search for similar items in EconPapers)
JEL-codes: F42 G18 G21 (search for similar items in EconPapers)
Date: 2010-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.eaber.org/node/22755 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 301 [REDIRECT LOOP] Moved Permanently (http://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755 [301 Moved Permanently]--> https://www.eaber.org/node/22755)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eab:financ:22755

Access Statistics for this paper

More papers in Finance Working Papers from East Asian Bureau of Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by Shiro Armstrong ().