Publication detail

Varieties of banking regulation in new and old EU countries

Author(s): PhDr. Zdeněk Kudrna PhD.,
Type: IES Working Papers
Year: 2008
Number: 0
Published in: IES Workign Paper
Publishing place: Praha
JEL codes: G2 1,  G2 8,  P34
Suggested Citation: Kudrna, Z. (2008): Structure of banking regulatory regime: EU15 and EU10 compared. IES Working Papers. Charles University in Prague, forthcoming.
Abstract: We  compare th e  structure of ba nk  reg ulat o ry regimes  in old and ne w  EU  memb er  states 
(EU15  and  EU10). We find  that des pit e gener al  structural conv ergence, there remain  systematic  
differences. Th e  EU 10  re gimes  provi d e  bank  regulators with  more po wer ,  but less  discretion.  They 
rely  on more  rigid, bu t simple to enforc e rules  for lo a n  cl as s i f i ca ti o n  and pr ovis i o ni ng  and  for capital  
di s burs e me n t.  EU10  regimes are also more  restrictiv e  on  banks’  i n v o lv em ent  in real es ta te  business.  These  stru ctu ral difference s  ar e systematic,  as  th ey  are pres en t in  mos t EU10  co untries ,  but absent   in most EU1 5 countri e s.  We  conjecture tha t  prevailing di ff eren ces  ca n  be ex pl a ined by  le gacies  of   ba nk ing  trans ition. The  pa per  pro v id es  empirical sup port fo r  th e claim that desp ite strong te nd en cy   for conv erge nce  of bank ing re gulator y regimes, there  re main s pol icy  spa ce for EU co untries  to  a ddr es s  their  specific challenges.  


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