Reference no: EM132286181 , Length: word count:1800
Problem
The following Questions (2-1 to 2-3) are based on the following paper
"Information Paper- Domestic systemically important banks in Australia, December 2013"
"D-SIB indicators are included in any assessment methodology for determining systemic importance, they should primarily relate to 'impact of failure' measures as opposed to 'risk of failure' measures."
2-1 Why the "impact of failure" is considered more important than the "risk of failure" by the Regulators?
2-2 How is the "impact of failure" measured for Australian banks?
"the four major banks are systemically important, which imposes a negative externality on the domestic financial system. Significant and protracted difficulties in any one of them would have severe repercussions for the entire financial system and, in turn, the real economy."
2-3 Do you agree or disagree with this statement?
Analyse Figure 1 to 7, take the data of four major banks and prepare a comparative status of their performances to support your answer.
[Hint: In addition to reading the above paper, you are encouraged to do additional research, can use additional resources from Web. You can use Tables, graphs, chats, diagrams or any other form of tools you find them necessary to support your answers]