We have received an excellent article from Meteor in relation to Global Systemically Important Banks which we thought would assist investors when considering Structured Investment products (capital at risk). We have briefly summarised the details below but also attach a link to the full article.
Following the collapse of Lehman Brothers and the global financial crisis, the notion of the ‘systemic financial institution’ was promoted, suggesting which institution’s failure may prompt a wider financial crisis; informally implying that these institutions were ‘too big to fail’.
The regulators recognised the correlation of large banks as a weakness and in 2011 developed a method to detect systemically sensitive banks. To this end, a list of these systemically important banks is produced/updated annually whereby enhanced supervision is provided to those components.
The impact that a failure of an institution would have on the financial system and economy worldwide is important and measured systemically instead of the risk a failure could occur. This measurement is based on a number of indicators.
We append below the latest list of G-SIBs as identified by the Financial Stability Board (FSB):
To read the full article please click on the following link: https://meteoram.com/systemically-important-banks-2020/
Best Price FS Team