The Development of International Financial Regulation and Supervision 1961-1982
Lead Research Organisation:
University of Glasgow
Department Name: School of Social & Political Sciences
Abstract
Abstracts are not currently available in GtR for all funded research. This is normally because the abstract was not required at the time of proposal submission, but may be because it included sensitive information such as personal details.
People |
ORCID iD |
| Catherine Schenk (Principal Investigator) |
Publications
Catherine Schenk (Author)
(2010)
Are we bad students or do we have poor teachers : why don't we learn the lessons from previous crises
in Corporate finance review
Catherine Schenk (Author)
(2012)
Financing Globalization: lessons from history
McCauley R
(2015)
Reforming the International Monetary System in the 1970s and 2000s: Would a Special Drawing Right Substitution Account Have Worked?
in International Finance
Mourlon-Druol E
(2014)
Don't Blame the Euro: Historical Reflections on the Roots of the Eurozone Crisis
in West European Politics
Mourlon-Druol E
(2016)
Banking Union in Historical Perspective: The Initiative of the European Commission in the 1960s-1970s
in JCMS: Journal of Common Market Studies
Mourlon-Druol E
(2015)
'Trust is good, control is better': The 1974 Herstatt Bank Crisis and its Implications for International Regulatory Reform
in Business History
Schenk
(2011)
International Economic Relations since 1945
Schenk C
(2017)
Rogue Trading at Lloyds Bank International, 1974: Operational Risk in Volatile Markets
in Business History Review
Schenk C
(2016)
Central Banks at a Crossroads - What Can We Learn from History?
Schenk C
(2013)
The Sterling Area and Economic Disintegration
in Geschichte und Gesellschaft
Schenk C
(2014)
Summer in the City: Banking Failures of 1974 and the Development of International Banking Supervision
in The English Historical Review
Schenk C
(2013)
The Dissolution of a Monetary Union: The Case of Malaysia and Singapore 1963-1974
in The Journal of Imperial and Commonwealth History
Schenk C
(2015)
History of the IMF - Organization, Policy, and Market
Schenk, C. R.
Oxford Handbook of Banking and Financial History
Singleton J
(2015)
The shift from sterling to the dollar, 1965-76: evidence from A ustralia and N ew Z ealand
in The Economic History Review
| Description | The research undertaken during the period of the grant explored the relationships between commercial banks, central banks and multilateral institutions to identify how the regulation and supervision of international banking developed during the period from 1965-1982 in Europe, USA and Hong Kong. This was a period of considerable financial innovation combined with systemic instability. There were several shocks to the system including the erosion of capital controls, the advent of floating exchange rate regimes, asset market volatility and commodity price shocks (especially the oil crises of 1973 and 1982). The outcomes of the research are on-going but the key findings to date include: 1. The lack of comprehensive, timely and consistent data on international banking and particularly the accumulation of sovereign debt by less developed economies arose from competition among agencies (IMF, IBRD, BIS, national supervisors and central banks) and from the reluctance of banks themselves to share their information. This resulted in an opacity that reduced the ability of lenders to measure risk. The research identified several initiatives during the 1970s that sought to improve the quality of the data, but these all foundered on the inability/unwillingness of central banks to coordinate the collection and dissemination of data and the reluctance of banks to share their data. 2. There is clear evidence of moral hazard in sovereign lending during the 1970s apparent in the meetings and correspondence between international banks and the International Monetary Fund and between US banks and the New York Federal Reserve. 3. Banks were under considerable pressure to internationalise in order to retain their competitive position in rapidly growing markets, but they were ill equipped to establish the internal governance structures that would support such an extension. The project identified cases of rogue trading and other forms of fraud that contributed to instability in international banking markets, particularly in a near-miss international banking crisis in 1974. 4. During the 1970s there was a rapid increase in the number of non-bank financial intermediaries that were outside the regulatory and supervisory framework for existing authorities and this increased the fragility of the banking system through several channels. 5. The initial meetings of the Basel Committee established in 1975 to improve the supervision of the international banking system showed the resistance to innovation, the limits to coordination and the inconsistency of national supervisory systems among the G10 (plus Switzerland and Luxembourg) central banks. This helps to explain why there were no appropriate safe-guards in place before the onset of the Latin American sovereign debt crisis of 1982. |
| Exploitation Route | The research undertaken has generated some data on Hong Kong's banking system which have been deposited for public use. Further research on European and Japanese banks will increase robustness of the results. |
| Sectors | Financial Services, and Management Consultancy,Government, Democracy and Justice |
| URL | http://www.bank-reg.co.uk |
| Description | The research on the development of prudential supervision and regulation and the evolution of the global financial system has been shared with academics, central bankers and commercial bankers in a range of countries through workshops, conferences and seminars including at the United Nations General Assembly, International Monetary Fund, Hong Kong Monetary Authority, Chatham House, Bank for International Settlements and the Bank of England. The research has also been disseminated to the public through publications by the Centre for International Governance Innovation, Gailfosler llc, Wall Street Journal, The Conversation, World Financial Review. Highlights include 1. I was invited to share my research on international economic and financial reform in an address to the General Assembly of the United Nations in December 2014. I was then part of a panel of 4 (representing the IMF, Financial Stability Board, Bank of Thailand) in a 3 hour Q&A session. This session forms part of the UN reform of the millenium development goals that will be discussed at Addis Ababa Accord on Financing for Development in July 2015. 2. In January 2015 I was a co-organiser of a high level symposium at the International Monetary Fund in Washington DC on Macroeconomic Coordination. My co-organiser was the Assistant Director, and Chief, Systemic Issues Division, in the Research Department of the International Monetary Fund. The symposium included participants from academic institutions in Europe and the USA as well as IMF staff and consultants. I was also able to meet with the IMF Chief Economist to discuss my research. |
| First Year Of Impact | 2010 |
| Sector | Financial Services, and Management Consultancy,Government, Democracy and Justice |
| Impact Types | Policy & public services |
| Description | Address to United Nations General Assembly, New York and 3 Hour Q&A |
| Geographic Reach | Multiple continents/international |
| Policy Influence Type | Contribution to a national consultation/review |
| URL | http://www.un.org/esa/ffd/wp-content/uploads/2015/01/FfD_SubInfSessions_Dec_Informal-Summary.pdf |
| Description | Advisor to Gailfosler llc |
| Geographic Reach | North America |
| Policy Influence Type | Participation in a guidance/advisory committee |
| Description | Lecture to Bank of England Centre for Central Banking Studies |
| Geographic Reach | Multiple continents/international |
| Policy Influence Type | Influenced training of practitioners or researchers |
| Description | University of Glasgow Columbia University Travel Scheme - Early Career Visiting Fellow |
| Amount | £2,000 (GBP) |
| Organisation | University of Glasgow |
| Sector | Academic/University |
| Country | United Kingdom |
| Start | 09/2013 |
| End | 10/2013 |
| Title | Hong Kong Bank Balance Sheet Data 1962-1972 |
| Description | |
| Type Of Material | Database/Collection of data |
| Year Produced | 2014 |
| Provided To Others? | Yes |
| Title | Weekly Gold Market Prices in Hong Kong 1962-1972 |
| Description | |
| Type Of Material | Database/Collection of data |
| Year Produced | 2014 |
| Provided To Others? | Yes |
| Description | Chatham House Task Force on Role of Gold in the International Monetary System |
| Organisation | Chatham House |
| Country | United Kingdom |
| Sector | Public |
| PI Contribution | This task force met several times and produced a report. I participated in the discussions and helped to edit/write the final report. |
| Collaborator Contribution | The task force included academics and business representatives as well as from teh Chinese Academy of Social Sciences. Chatham House hosted the meetings in London and published the final report. |
| Impact | Gold and the International Monetary System: Chatham House Report, February 2012 |
| Start Year | 2012 |
| Description | Norges Bank Bicentenary Project |
| Organisation | Norges Bank |
| Country | Norway |
| Sector | Private |
| PI Contribution | Norges Bank has commissioned an edited volume from leading global scholars to celebrate its Bicentenary to be published by Oxford University Press. I am participating, wrote a chapter (in collaboration with a colleague Tobias Straumann from University of Zurich) and attended the inaugural international conference in Geneva. |
| Collaborator Contribution | Norges Bank provided editorial support, publication costs and support for ravel to the conference. |
| Impact | Schenk, C., and Straumann, T. (2016) Central banks and the stability of the international monetary regime. In: Bordo, M. D., Eitrheim, Ø., Flandreau, M. and Qvigstad, J. F. (eds.) Central Banks at a Crossroads: What Can We Learn from History? Series: Studies in macroeconomic history. Cambridge University Press, pp. 319-355. ISBN 9781107149663 |
| Start Year | 2013 |
| Description | Banking Union for Europe: Burden or Benefit? |
| Form Of Engagement Activity | A formal working group, expert panel or dialogue |
| Part Of Official Scheme? | No |
| Type Of Presentation | workshop facilitator |
| Geographic Reach | International |
| Primary Audience | Industry/Business |
| Results and Impact | Lunchtime Round Table for media and bankers in Frankfurt, Germany: Chaired by Catherine Schenk, hosted by European Association for Banking History Chiara Zillioli, Deputy Chief Counsel ECB Dirk Schumaker, Senior European Economist at Goldman Sachs International Karl Cordewener, Deputy Secretary-General, Basel Committee on Banking Supervision Kern Alexander, Professor of Law and Finance at University of Zurich The recent banking crisis highlighted the need for swift and decisive action by EU-level funding arrangements. As the European Central Bank (ECB) takes over its role as Single Supervisory Authority in the Euro-zone, there is an opportunity to take stock of current developments in international financial regulation and supervision, and provide insights into possible future directions. This round table discussed these developments in their wider context, their impact on the real economy, and the pros and cons for the different stakeholders. The discussion will offer an interdisciplinary perspective, across law, history and economics, and involve both, academics and policy-makers. What is the role of the Basel Committee on Banking Supervision in current debates? What are the main challenges that the ECB will face as Single Supervisory Authority? What are the prospects and limits of creating a European banking union? Which lessons can be drawn from previous efforts to harmonise European banking? Reported in the press |
| Year(s) Of Engagement Activity | 2014 |
| Description | C.R. Schenk, 'Gold as a Money Anchor: we have been here before', |
| Form Of Engagement Activity | A magazine, newsletter or online publication |
| Part Of Official Scheme? | Yes |
| Geographic Reach | International |
| Primary Audience | Professional Practitioners |
| Results and Impact | Briefing note for GailFosler Group LLC, September 2011, http://www.gailfosler.com/featured/gold-as-a-money-anchor-we-have-been-here-before This note emphasises the importance of a historical understanding of global markets for assessing current trends. This briefing note was a commissioned piece based on my ESRC funded research. GailFosler LLC is a consultancy company based in the USA. This briefing note was a commissioned piece based on my ESRC funded research. GailFosler LLC is a consultancy company based in the USA. |
| Year(s) Of Engagement Activity | 2011 |
| URL | http://www.gailfosler.com/featured/gold-as-a-money-anchor-we-have-been-here-before |
| Description | Chatham House Round Table |
| Form Of Engagement Activity | A formal working group, expert panel or dialogue |
| Part Of Official Scheme? | No |
| Geographic Reach | National |
| Primary Audience | Professional Practitioners |
| Results and Impact | Round Table with senior bank executives (Chief Economist of Standard Chartered, Managing Director of Deutsche Bank, Managing Director FTI Consulting) on the role of gold in the international monetary system. I spoke on the long term development of the global system and responded to questions from the floor. The audience were from London banks, media, policy-makers |
| Year(s) Of Engagement Activity | 2012 |
| URL | https://www.chathamhouse.org/sites/files/chathamhouse/public/Research/International%20Economics/2802... |
| Description | Podcast: Regulatory Coherence and the Future of Finance: Five Years After the Crash of 2008 |
| Form Of Engagement Activity | A broadcast e.g. TV/radio/film/podcast (other than news/press) |
| Part Of Official Scheme? | Yes |
| Geographic Reach | International |
| Primary Audience | Public/other audiences |
| Results and Impact | Podcast: Catherine Schenk in Conversation with Iain MacNeil This podcast was recorded by Chatham House as part of the Conference organised by Schenk and MacNeil on international financial regulation. In an interview, Schenk discusses the importance of the historical dimension to understanding the current obstacles to effective international regulatory reform. This podcast was recorded by Chatham House as part of the Conference organised by Schenk and MacNeil on international financial regulation. In an interview, Schenk discusses the importance of the historical dimension to understanding the current obstacle |
| Year(s) Of Engagement Activity | 2013 |
| URL | http://www.chathamhouse.org/events/view/195671 |
| Description | Regulatory Coherence and the Future of Finance: Five Years After the Crash of 2008 |
| Form Of Engagement Activity | Participation in an activity, workshop or similar |
| Part Of Official Scheme? | No |
| Type Of Presentation | keynote/invited speaker |
| Geographic Reach | International |
| Primary Audience | Policymakers/politicians |
| Results and Impact | Participants Charles Goodhart, Director, Financial Regulation Research Programme, Department of Financial Markets Group, London School of Economics Iain MacNeil, Alexander Stone Chair of Commercial Law, School of Law, University of Glasgow Paola Subacchi, Research Director, International Economics, Chatham House Eugene White, Professor of Economics, Department of Economics, Rutgers University Steven Schwarcz, Stanley A Star Professor of Law and Business, Duke University Chair: Catherine Schenk, Professor of International Economic History, University of Glasgow -------------------------------------------------------------------------------- Type: Research and other events This conference addressed the issues of coherence and innovation in the regulatory response to the financial crisis. The speakers will discuss issues such as the objectives and techniques of financial regulation in a post-crisis world; the changes to the institutional structure of regulation at the national, regional and global level; the evolution in the nature and control of systemic risk; as well as the role of enforcement in responding to the financial crisis. This event is organized in partnership with the University of Glasgow and with the support of the Economic and Social Research Council (ESRC). Subsequent engagement with Chatham House |
| Year(s) Of Engagement Activity | 2013 |
| URL | http://www.chathamhouse.org/events/view/195671 |
| Description | Reinventing Bretton Woods Committee, Hangzhou, China |
| Form Of Engagement Activity | A talk or presentation |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Industry/Business |
| Results and Impact | The Reinventing Bretton Woods Committe meeting in Hangzhou China in May 2014 attracted central bankers, bankers, academics, Chinese government, representatives from the IMF, the Bank for International Settlements and international think tanks. I gave a presentation to the plenary session and participated in discussion thereafter. The theme was China in the International Monetary System |
| Year(s) Of Engagement Activity | 2014 |
| URL | http://www.reinventingbrettonwoods.org/event/china-international-monetary-system |
| Description | Visiting Fellow, Hong Kong Institute for Monetary Research: 2 seminars |
| Form Of Engagement Activity | A talk or presentation |
| Part Of Official Scheme? | No |
| Geographic Reach | International |
| Primary Audience | Policymakers/politicians |
| Results and Impact | I was visiting fellow at the Hong Kong Institute for Monetary Research April-May 2014 and gave a seminar paper to Hong Kong Monetary Authority staff and at the Hong Kong University Law School where participants from banks attended. |
| Year(s) Of Engagement Activity | 2014 |