TAILIEUCHUNG - Lecture Legal and regulatory aspects of banking supervision – Chapter 4

The following will be discussed in this chapter: Big assumption, misaligned incentives & pitfalls, good days turn bad, start of failure, sub prime global financial crisis, financial crisis, poor investors, desperate bank, lessons learned and action plans. | MBF-705 LEGAL AND REGULATORY ASPECTS OF BANKING SUPERVISION OSMAN BIN SAIF Session: Four Summary of Previous Session Credit rating agencies Mortgage Brokers Secondary Mortgage Markets The Mess Evolution of Home Mortgage New model of Mortgage lending Private sub prime mortgage process Reasons for forming of subprime mess 2 Agenda of this session Big Assumption Misaligned incentives & pitfalls Good Days turn Bad Start of Failure Sub prime Global financial crisis Financial Crisis Poor investors Desperate Bank Lessons Learned and Action Plans 3 Agenda of this Session Finance and Economy Investment devalued across the Globe Impact of Financial crisis across the Globe 4 Big assumptions Belief that modern capital markets had become so much more advanced than their predecessors that banks would always be able to trade debt securities. This encouraged banks to keep lowering lending standards, since they assumed they could sell the risk on. 5 5 Big Assumptions (Contd.) Many investors assumed .

• Ngân hàng - Tín dụng
• Banking supervision
• Banking operations
• Banking practices globally
• Role of the supervisor
• Banking companies ordinance
• Bank regulation
• Financial supervision
• Banking system
• Mortgage brokers