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Year 2013, Volume: 2 Issue: 4, 19 - 32, 01.12.2013

Abstract

References

  • Ali, A. and Daly, K. (2010), Macroeconomic Determinants of Credit Risk: Recent Evidence from a Cross Country Study,International Review of Financial Analysis, Vol. 19, pp. 165-171.
  • Barth, J. R, Caprio, G. Jr. and Levine, R. (2008), Bank Regulations are Changing: For Better or Worse?,Comparative Economic Studies, Vol. 50, pp. 537–563.
  • Benink, H., Danielsson, J. and Jonsson, A. (2008), On the Role of Regulatory Banking Capital,Financial Markets, Institutions & Instruments, Vol. 17, No. 1, pp. 85-96.
  • Blundell-Wignall, A. and Atkinson, P. (2010), Thinking Beyond Basel III: Necessary Solutions For Capital And Liquidity, OECD Journal: Financial Market Trends, Vol. 1, pp. 1-23.
  • Chamia R.andCosimanob T. F. (2010). Monetary Policy with a Touch of Basel. Journal of Economics and Business, 62, 161–175.
  • Chang, Y. T., (2006), Role of Non-Performing Loans and Capital Adequacy in Banking Structure and Competition. University of Bath School of Management Working Paper Series, 2006.16.
  • Danielsson, J., Embrechts, P., Goodhart, C., Keating, C., Muennich, F. and Renault, O. (2001),An Academic Response to Basel II,Financial Markets Group, London School of Economics, Special Paper, No. 130.
  • Demirgüç-Kunt, A., Detragiache E. andTressel T. (2006). Banking on the Principles: Compliance with Basel Core Principles and Bank Soundness, IMF Working Paper, WP/06/242.
  • Decamps, J., Rochet, J. and Roger, B. (2004), The Three Pillars of Basel II: Optimizing the Mix,Journal of Financial Intermediation, Vol. 13, pp. 132-155.
  • Gordy, M. B. and Howells, B. (2006), Procyclicality in Basel II: Can We Treat the Disease Without Killing the Patient, Journal of Financial Intermediation, Vol. 15, pp. 395–417.
  • Griffith-Jones, S., Segoviano, M. A. and Spratt, S. (2002), Basel II and Developing Countries: Diversificationand Portfolio Effects, http://eprints.lse.ac.uk/24824/1/dp437.pdf.
  • Heid, F. (2007), The Cyclical Effects of The Basel II Capital Requirements. Journal of Banking & Finance, Vol. 31, pp. 3885–3900.
  • Herring, R. J. (2004, The Subordinated Debt Alternative to Basel II, Journal of Financial Stability, Vol. 1, pp. 137–155.
  • Hermsen, O. (2010), Does Basel II Destabilize Financial Markets? An Agent-based Financial Market Perspective,The European Physical Journal B, Vol. 73, pp. 29-40.
  • Majnoni, G., Miller, M. and Powell, A. P. (2004), Bank Capital and Loan Loss Reserves under Basel II: Implications for Emerging Countries, World Bank Policy Research Working Paper, No. 34
  • Moreira, F. F. (2010), Copula-Based Formulas to Estimate Unexpected Credit Losses (The Future of Basel Accords?),Financial Markets, Institutions & Instruments, Vol. 19, No. 5, pp. 381-404.
  • Mrak, M. (2003), Implementation of The New Basel Capital Accord In Emerging Markets, Dissertation submitted in partial fulfilment of the requirements for the Master of Laws degree in International Economic Law at the University of Warwick.
  • Reisen, H. (2001),Will Basel II Contribute to Convergence in International Capital Flows? Paper prepared for Oesterreichische Nationalbank, 29th Economics Conference, Vienna.
  • Rochet, J. (2004), Rebalancing the Three Pillars of Basel II. FRBNY Economic Policy Review, pp. 7-21.
  • Scellato, G. and Ughetto, E. (2010), The Basel II Reform and The Provision of Finance For R&D Activities in SMEs: An Analysis of a Sample of Italian Companies,International Small Business Journal, Vol. 28, No. 1, pp. 65-89.
  • Tonveronachi, M. (2009), Implications of Basel II for Financial Stability. Clouds are Darker for Developing Countries. PSL Quarterly Review, Vol. 62, No. 248-251, pp. 121-146.
  • Zicchino, L. (2006), A Model of Bank Capital, Lending and The Macroeconomy: Basel I versus Basel II,The Manchester School, Supplement 2006, pp. 50-77.

Basel Accords: Lessons For Turkey

Year 2013, Volume: 2 Issue: 4, 19 - 32, 01.12.2013

Abstract

In the last two decades, the world economies have experienced severe financial crises. After every crisis “new” financial regulations were offered to prevent an upcoming one. Basel Criteria have become the milestone of these regulations regarding the banking sectors where the problems and the solutions of the financial crises have emanated. However, it is observed that the Basel Accords have not met the required measures in preventing the world economy from entering a global financial crisis in 2008. Turkish banking sector has been implementing its ownmeasures which are tighter than the Basel criteria since the financial crisis it went through in 2001 and has been growing in spite of the last financial turmoil unlike its developed country counterparts. Thus our aim is to compare the banking sectors of Turkey and 10 other OECD countries for the period 2000-2008, and try to answer whether Turkey performs better regarding risk management and whether she should adopt the Basel criteria or not. To this end, we perform a panel data estimation making use of measures such as capital adequacy ratio, liquid reserves, and non-performing loans. The results indicate that in time Turkish banking sectorgot better in handlingrisk management, but that it is more prone to risk compared to OECD countries.

References

  • Ali, A. and Daly, K. (2010), Macroeconomic Determinants of Credit Risk: Recent Evidence from a Cross Country Study,International Review of Financial Analysis, Vol. 19, pp. 165-171.
  • Barth, J. R, Caprio, G. Jr. and Levine, R. (2008), Bank Regulations are Changing: For Better or Worse?,Comparative Economic Studies, Vol. 50, pp. 537–563.
  • Benink, H., Danielsson, J. and Jonsson, A. (2008), On the Role of Regulatory Banking Capital,Financial Markets, Institutions & Instruments, Vol. 17, No. 1, pp. 85-96.
  • Blundell-Wignall, A. and Atkinson, P. (2010), Thinking Beyond Basel III: Necessary Solutions For Capital And Liquidity, OECD Journal: Financial Market Trends, Vol. 1, pp. 1-23.
  • Chamia R.andCosimanob T. F. (2010). Monetary Policy with a Touch of Basel. Journal of Economics and Business, 62, 161–175.
  • Chang, Y. T., (2006), Role of Non-Performing Loans and Capital Adequacy in Banking Structure and Competition. University of Bath School of Management Working Paper Series, 2006.16.
  • Danielsson, J., Embrechts, P., Goodhart, C., Keating, C., Muennich, F. and Renault, O. (2001),An Academic Response to Basel II,Financial Markets Group, London School of Economics, Special Paper, No. 130.
  • Demirgüç-Kunt, A., Detragiache E. andTressel T. (2006). Banking on the Principles: Compliance with Basel Core Principles and Bank Soundness, IMF Working Paper, WP/06/242.
  • Decamps, J., Rochet, J. and Roger, B. (2004), The Three Pillars of Basel II: Optimizing the Mix,Journal of Financial Intermediation, Vol. 13, pp. 132-155.
  • Gordy, M. B. and Howells, B. (2006), Procyclicality in Basel II: Can We Treat the Disease Without Killing the Patient, Journal of Financial Intermediation, Vol. 15, pp. 395–417.
  • Griffith-Jones, S., Segoviano, M. A. and Spratt, S. (2002), Basel II and Developing Countries: Diversificationand Portfolio Effects, http://eprints.lse.ac.uk/24824/1/dp437.pdf.
  • Heid, F. (2007), The Cyclical Effects of The Basel II Capital Requirements. Journal of Banking & Finance, Vol. 31, pp. 3885–3900.
  • Herring, R. J. (2004, The Subordinated Debt Alternative to Basel II, Journal of Financial Stability, Vol. 1, pp. 137–155.
  • Hermsen, O. (2010), Does Basel II Destabilize Financial Markets? An Agent-based Financial Market Perspective,The European Physical Journal B, Vol. 73, pp. 29-40.
  • Majnoni, G., Miller, M. and Powell, A. P. (2004), Bank Capital and Loan Loss Reserves under Basel II: Implications for Emerging Countries, World Bank Policy Research Working Paper, No. 34
  • Moreira, F. F. (2010), Copula-Based Formulas to Estimate Unexpected Credit Losses (The Future of Basel Accords?),Financial Markets, Institutions & Instruments, Vol. 19, No. 5, pp. 381-404.
  • Mrak, M. (2003), Implementation of The New Basel Capital Accord In Emerging Markets, Dissertation submitted in partial fulfilment of the requirements for the Master of Laws degree in International Economic Law at the University of Warwick.
  • Reisen, H. (2001),Will Basel II Contribute to Convergence in International Capital Flows? Paper prepared for Oesterreichische Nationalbank, 29th Economics Conference, Vienna.
  • Rochet, J. (2004), Rebalancing the Three Pillars of Basel II. FRBNY Economic Policy Review, pp. 7-21.
  • Scellato, G. and Ughetto, E. (2010), The Basel II Reform and The Provision of Finance For R&D Activities in SMEs: An Analysis of a Sample of Italian Companies,International Small Business Journal, Vol. 28, No. 1, pp. 65-89.
  • Tonveronachi, M. (2009), Implications of Basel II for Financial Stability. Clouds are Darker for Developing Countries. PSL Quarterly Review, Vol. 62, No. 248-251, pp. 121-146.
  • Zicchino, L. (2006), A Model of Bank Capital, Lending and The Macroeconomy: Basel I versus Basel II,The Manchester School, Supplement 2006, pp. 50-77.
There are 22 citations in total.

Details

Journal Section Articles
Authors

Müge Karacal This is me

Emre Can This is me

İlker Arslan This is me

Publication Date December 1, 2013
Published in Issue Year 2013 Volume: 2 Issue: 4

Cite

APA Karacal, M., Can, E., & Arslan, İ. (2013). Basel Accords: Lessons For Turkey. Journal of Business Economics and Finance, 2(4), 19-32.

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