Abstrakt

The cyclical nature of economic development, and in particular periods of crisis, alter the conditions under which risk is managed. The changes that have ensued in recent decades have given rise to the emergence of a new environment for banking sector entities. Banks, whose activity is mainly predicated upon the management of risk, must identify changes in their operating environment on an ongoing basis and adapt their management systems (including risk management) to new challenges. The dynamics and scale of change in the banking environment has in recent years been of such significant extent that merely monitoring said change is a highly inadequate response if meeting the requirements of conducting banking operations safely is the goal. Bank management must analyze how various scenarios, even those highly unlikely but nevertheless possible ones, could impact a given bank, and undertake adaptive measures.The most important changes in banking are interconnected phenomena: globalization, and the development of technology and communications.

The most destructive impact on the stability of financial markets comes from the rising level of moral hazard, which on the one hand is related to financial sector deregulation, leading to the emergence of entities that are “too big to fail” and to an unprecedented expansion of finance, and on the other, to a series of regulatory decisions taken in response to the global financial crisis. Growing capital mobility and rising competitive pressures are further conducive to moral hazard. As a consequence, the business cycle structure has undergone a fundamental change, in particular with respect to the source and nature of crisis-related disturbances. A deterioration has also taken place with respect to the perception of the role of safety measures in place to counteract the consequences of risk. An analysis of a bank’s fragility to the incidence of change in its operating environment constitutes the basis for shaping its risk management strategy and for creating the necessary safety buffers that will enable the bank to withstand adverse circumstances.

Banks should have action plans in place with respect to foreseeable negative or crisis scenarios in order to, in practice, ensure sufficient time to deal with unforeseeable problems.

Financial system regulations must be changed in such a way as to effectively limit moral hazard and eliminate conditions that contribute to its emergence. Problems associated with the further development of finance in a direction that is disconnected from the needs of the real economy, as well as market consolidation that is reflected in the growth of entities that are “too big to fail”, and even “too big to be effectively rescued”, should be a priority for regulators and policymakers. Sanctions in the form of elimination from the market of entities that take on excessive risk can limit moral hazard and enhance market discipline. In a European context, an urgent challenge is to develop methods and procedures for the orderly liquidation of banks (resolution). In terms of introducing corrections to the financial system infrastructure, it is necessary to separate discrete types of activity (particularly intermediation vs. investment and trading operations) in order to limit the exposure of consumer bank deposits to investment or trading risk. It is also desirable, even necessary, to simplify the structure of very large banking groups.