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In the academic literature governance is a contested term. It is about how organisations are run and the oversight and accountability that are encompassed in this process. However, it can also be viewed in terms of delivery, 'getting things done'. In the public service this equates to implementing government policy, which is why the term is sometimes seen as synonymous with public management. Collaborative governance recognises that delivering on many government policies requires different sectors and levels of government working across organisational boundaries. This presents its own additional set of challenges. This paper reviews the governance of public service reform since the financial crisis in 2011. This is a policy area that clearly requires a 'joined-up' approach. The paper uses a governance framework that emerged from an extensive research programme between the Environmental Protection Agency and the Institute of Public Administration examining water governance arrangements. While it is clear that governance matters a great deal, achieving it in practice can be complex. This paper identifies strengths and weaknesses in respect of the governance of public service reform and makes recommendations for improvements. [ABSTRACT FROM AUTHOR]

In 2018, the Journal of Financial Service Professionals continued its proud tradition as a leading source of ideas for the financial services community. This column highlights the various topics we covered and lets you know what we had to offer this past year. We hope this summary is a useful tool for reviewing the educational opportunity provided by the Journal. [ABSTRACT FROM AUTHOR]

The delivery of financial services was revolutionized by digitization, which compelled financial institutions to adopt technology that enables them to provide the best appropriate service at a reasonable price. However, due to recent disruption in the country's financial system, financial institutions must incorporate modern technologies to help lower ineffectiveness and improve service quality. This study investigates the impact of digital economy on financial sector competence. According to literature studies, financial organizations in Pakistan are attempting to adopt and integrate digitization into their operations. Given that a generous portion of Pakistan's population is considered digitally illiterate, the number of people who signed up for and used digital financial products was staggering. Therefore, financial institutions must incorporate their business functions with pertinent technology to maintain and improve profitability. Furthermore, they must invest in digital infrastructure and human resource training to incorporate technology in providing services. Policymakers should also strengthen data security and cybercrime laws, policies, and regulations to allow market participants for free and confident operation. [ABSTRACT FROM AUTHOR]

The article explores the developments in laws governing the financial technology services companies in the U.S. Topics discussed include the business model that is commonly used by financial technology companies which involves partnerships with depository institutions, the joint resolution signed by U.S. President Joe Biden that repeals the Office of the Comptroller of the Currency's True Lender Rule pursuant to the Congressional Review Act, and discord over the True Lender Rule.

Clearinghouses are systemic nodes in financial markets that handle trillions of dollars' worth of transactions. Yet, these critical market infrastructures stand on fragile foundations. The Dodd-Frank Wall Street Reform Act of 2010, the sweeping financial reform that followed the 2008, financial crisis, embraced clearinghouses as systemic risk managers for the over-the-counter derivatives markets. While policymakers used clearinghouses to remove some counterparty risk from the markets, they ended up concentrating that risk onto them, making them systemically important, This Article warns that while clearinghouses may have addressed some of the failures of the pre-crisis derivatives markets, they have created new issues that still remain unaddressed. The economic and governance structure set in place by the existing regulatory regime and the private rules adopted by clearinghouses in their self-regulatory capacity have important and as-yet overlooked fragilities that can undermine clearinghouses' mission as financial stability bastions and transform them into systemic risk spreaders. Clearinghouses operate in a framework of misaligned incentives. They face unique agency costs that spill from what this Article defines as the "member-shareholder divide" and the "separation of risk and control." Because of their economic structure, the ultimate risk of the business is passed down to the members (i.e., users) of the clearinghouses and not borne by their shareholders, which creates moral hazard. This dynamic is further exacerbated by the tension between the public policy role bestowed on clearinghouses as systemic risk buffers and the for-profit nature of the financial conglomerates to which they belong. In addition, while clearinghouses were embraced as countercyclical mechanisms to stabilize the markets, the operation of their loss-absorption and mutualization junction have procyclical,features that put strong pressure on clearing members, while clearinghouses' shareholders have a small equity at stake. After offering a political economy explanation of the current regulatory regime for clearinghouses, this Article urges policymakers and the industry to intervene in order to re-align the incentives of clearinghouses' shareholders with those of their members in order to ultimately enhance. Financial stability. Building on insights from the corporate governance and finance literature, this Article proposes reforms to address the unique agency costs that clearinghouses face, to enhance their governance and resilience, and to ensure their role as private systemic stability infrastructures. Clearinghouses should have more skin in the game in their business and their capital structure should be complemented with hybrid convertible financial instruments to more effectively allocate losses, recapitalize the business, and better align the economic incentives of clearinghouses' stakeholders. A multi-stakeholder board should be established to enhance the participative governance Of these firms and support the legitimacy and accountability of their operations. Finally, a new approach to the recovery and resolution of troubled clearinghouses that could result in their remutualization should be implemented in order to provide certainty in times of distress. as well as an ultimate realignment of members' and shareholders' incentives. [ABSTRACT FROM AUTHOR]

Innovative services such as mobile payments are potentially transformative because they can increase access to financial services, especially in developing countries. However, such innovations can disrupt the financial services ecosystem, prompting regulators to respond in different ways. These regulatory responses often have a significant impact on the success of such innovative services. Using Nigeria's regulatory approach as a case study, this article highlights specific lessons that should inform future attempts at regulating mobile payments. [ABSTRACT FROM AUTHOR]

This paper aims to discuss the Effect of Financial Reform and Fiscal Decentralization on Financial Governance in Bone, Indonesia. Financial performance analysis can be done by looking at the ratio of the degree of fiscal decentralization, regional financial dependence, regional independence, the effectiveness and efficiency of ROI, and compatibility of direct spending to analyze the effect of financial performance on the Human Development Index (HDI). This research found that the HDI in Bone Regency 2010-2019 was influenced by the direct expenditure compatibility ratio. [ABSTRACT FROM AUTHOR]

Variable universal life insurance, a financial instrument blending in features of both a conventional insurance policy and a securities product, has a long history in sophisticated financial markets such as the United States, yet is new to China'sfinancial system. The variable insurance made in China serves different business purposes than its U.S. counterparts. Notably, it played a salient role as afinancing instrument for the hostile bidder in the landmark Baoneng/Vanke hostile takeover attempt. It results in distinctivefnancial risks emergingfrom China's regulation institution. Drawing contrast to the United States and employing theories on the economic analysis of regulation, this article examines the previous and current regulatory approaches toward the Chinese version of variable insurance and criticizes the disoriented regulation philosophy. It argues that the newly promulgated Asset Management Rules are not helpjul in recognizing the securities feature embedded in variable insurance, nor do they optimally mitigate the financial risks associated with variable insurance. The policymakers have yet to balance the freedom offinancial innovation with the regulation of the financial market. As a result, the regulators would have to sacrifice either the proper functioning of variable insurance or the stability of the financial system. [ABSTRACT FROM AUTHOR]

We present a model in which issuers of asset-backed securities choose to release coarse information to enhance the liquidity of their primary market, at the cost of reducing secondary market liquidity. The degree of transparency is inefficiently low if the social value of secondary market liquidity exceeds its private value. We show that various types of public intervention (mandatory transparency standards, provision of liquidity to distressed banks, or secondary market price support) have quite different welfare implications. Finally, we extend the model by endogenizing the private and social value of liquidity and the proportion of sophisticated investors. [ABSTRACT FROM PUBLISHER]

With the rapid innovation of Internet information technology, the market competition environment of China's banking industry has undergone significant changes, and the traditional banking functions have gradually been weakened. Against this background, the survival and development of the traditional banking industry are facing great challenges. The reform of banking financial services must speed up the process. Various sectors of the national economy are beginning to invest in the Internet industry. Banking is no exception. With the help of Internet technology, we hope to expand the development path of the banking Internet finance industry. [ABSTRACT FROM AUTHOR]

In recent years there has been increasing interest in the rise of shadow banking in China and India. In this paper, we aim to get a better understanding of the differences in trends and investigate the factors leading to the increase of shadow banking in these two major emerging economies. We find that financial exclusion is a common factor leading to the growth of shadow banking in both countries. While financial reform has taken place in India, financially repressive policies still prevail in China. Although several regulatory measures have been adopted in India and China, the size of the shadow banking sector in these two countries remains underestimated. Thus, streamlining and enhancing data collection is a key priority for both nations. We argue that regulation in both countries should be more activity focused (specific field in which a shadow bank is focused on) rather than sector or entity based, and it should be at par with banks. The shadow banks provide last mile connectivity to remote, distant, and ignored segments of the population not serviced by the formal financial sector. As this enhances financial inclusion, a balanced approach is required keeping in view both costs and benefits of the shadow banking system. [ABSTRACT FROM AUTHOR]

Financial inclusion is the process of building viable institutions that provide financial services to those hitherto excluded. These may include savings, insurances, remittances, and credit. Microfinance became the most dominant method for achieving financial inclusion. However, different microfinance schools of thought recommend opposite ways for attaining financial integration. India is a particularly insightful case study due to the sheer number of people excluded from formal financial services, as well as the spectrum of actors and approaches. The aim of this article is threefold. The first aim is to define financial inclusion, depicting its status quo in India and comparing it to its South Asian and Brazil, Russia, India, China, and South Africa (BRICS) peers using recently released data from the Global Findex database. The second aim is to focus on microfinance as the dominant vehicle for achieving financial inclusion by scrutinizing its definitions, contrasting its two leading "schools of thought," and analyzing the central role of its dominant group-based approach. The third aim of the article will examine why people opt to take micro-credit at 33 percent interest rates. [ABSTRACT FROM AUTHOR]

The article discusses the report the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, by Justice Kenneth Hayne, that investigated corrupt practices in banking industry of Australia. According to the author the financial institutions need to reform their business model and build trust with the public. Topics discussed in the report include the governmental regulatory oversight, the factors for misconduct, and the public hearings.

In November 2017 the Federal government established a Royal Commission into Australia's financial services industry that has become widely known as the Banking Royal Commission. The Commission has, during its hearings, and in its recent Interim Report, exposed serious misconduct and poor regulation in Australia's financial services industry. The authors argue that the recommendation of the 2014 Financial System Inquiry that there be an Assessment Board to provide continuous oversight of the financial regulators, APRA and ASIC, is an effective solution to the regulatory failures exposed by the Banking Royal Commission. The benefits to Australia of the establishment of an Assessment Board are clear, and include enhanced accountability, improvements in the regulator's culture, prevention of regulatory capture, and enhanced capacity to prevent financial crises. The introduction of an Assessment Board in Australia would serve as a timely and highly effective adjunct to the current Australian Twin Peaks financial regulatory architecture comprising APRA and ASIC. [ABSTRACT FROM AUTHOR]

Abstract: Global regulators agree there is a need to strengthen governance in financial firms. The failure of boards and senior management to consider the risks inherent in their pre‐crisis strategies is widely accepted as a crucial factor in the costly meltdown whose consequences continue to be felt. Regulators have tried to strengthen governance mechanisms and, in particular, have recommended a “three lines of defence” model to embed risk management throughout financial firms. Yet while this model is now in use across the financial sector in many countries, its origins are opaque, and its effectiveness untested. Some argue that diffusing the responsibility for risk management in this way in fact reduces accountability and effectiveness. And there is little external validation of the controls firms put in place. Does the three lines of defence system provide a false sense of security? Does it need to be rethought, or can it be enhanced? [ABSTRACT FROM AUTHOR]

Abstract: The G20's financial regulatory reform programme, underway since 2008, was designed as an integrated set of strengthened regulatory measures to make the global financial system more robust and less crisis‐prone. However, in practice the G20's stricter regulation of internationally active banks has not been matched by firmer oversight of other financial system participants that also take on large risks. The present article addresses the implications of this situation. Section  1 outlines the role of the banking sector within the broader market‐based financial system. Section  2 considers the dynamics of a crisis in such a system. The measures that the G20 has agreed thus far to strengthen the G‐SIBs, and regulators’ intentions with regard to strengthening other sectors of the financial system are summarized in Section  3. Section  4 describes how stricter bank regulation may affect the resilience of market‐based financial systems in conditions of stress. Section  5 discusses how the focus on strengthening bank regulation, combined with slow progress in extending regulation to other sectors, has accelerated structural change in the financial system and offers some conjectures on how this may alter financial risks, the way the financial system may respond to stress, and the implications for macroprudential regulation. [ABSTRACT FROM AUTHOR]

Despite negative public opinion, the role of the Korean government has expanded, while overcoming two rounds of global financial crises. The phenomenon of the re-swelling state is mainly attributed to the strengthening of the central bureaucracy, in particular the financial bureaucracy, rather than the whole central government or the state. The argument of the strengthening of the ‘state’ or the ‘government’ after economic crises might be subject to the error of generalization. Through the two rounds of economic crises, the financial bureaucracy succeeded in acquiring the authority of market supervision and industrial support. In consequence, the bureaucracy's institutional supremacy within the government grew less challenged. The central bureaucracy was no longer the loyal servant to the President. It has reinforced its institutional strength and autonomy vis-a-vis the President, the National Assembly, the Central Bank and civil society, under the pretext of building up the rational and autonomous market and democratic politics. [ABSTRACT FROM AUTHOR]

The post-crisis financial services regulatory overhaul, and. particularly, the creation of the European System of Financial Supervision (ESFS) and the Banking Union mechanisms, has increased the complexity of the EU financial supervisory architecture. In this new system, financial supervision is carried out by a network of interconnected financial supervisors, with different mandates and subject to various accountability structures, operating at both the Member State and EU levels and bound by a regime of cooperation duties. An efficient cooperation among and within the various levels of this complex supervisory architecture is critical for the good functioning of the EU financial system. This Article identifies and analyzes key supervisory cooperation challenges in the single market for financial services, and assesses whether the EU legal and regulatory frameworks effectively address them. The Article argues that, despite the advancement of EU financial services integration and supervisory convergence that the post-crisis regulatory overhaul has brought, there are important legal and regulatory obstacles to an efficient supervisory cooperation in the European Union; these source, primarily, from the following: first, the lack of clarity and precision of the EU regime on supervisory cooperation duties; second, the limited applicability of the ESFS's mediation mechanisms to supervisory cooperation disputes; and, third, the tensions between transnational mandates of financial supervision and national accountability structures and mandates. The Article also examines the threats that Brexit and the EU political crisis pose to EU financial integration and supervisory cooperation. [ABSTRACT FROM AUTHOR]

Financial inclusion has been considered as enabler for 7 of the 17 Sustainable Development Goals. With the development of industrial revolution 4.0, fintech is the key driver for financial inclusion, in both developing and developed countries. The roles of fintech for financial inclusions are clear, focusing on providing all financial services with lower costs, wider and better access (24/7). In Vietnam, legal framework on fintech has been developed, the fintech steering committee has been set up, and Vietnam is preparing the national financial inclusion strategy. In implementation, the fintech market is still young, but almost 40 companies have joined with increasing transaction volumes and high growth rate. The opportunities for fintech in Vietnam are huge, from demand side, infrastructure, and the market gap. However, the challenges still remained, coming from its nature, legal framework, small transaction and active clients ratio, and the low awareness of people on fintech for financial inclusions. The recommendations to fintech companies, commercial banks, State Bank of Vietnam, and other stakeholders have been proposed for better fintech utilization in promoting financial inclusion. [ABSTRACT FROM AUTHOR]

Risk management, for example relative to its finance counterpart, is a much younger function. This paper examines its evolution across different eras: Basel I, Basel II, III and its follow-ups, and in post International Financial Reporting Standard 9 (IFRS 9). The journey that started as risk compliance in the Basel I era has evolved to include a strategic role post Basel II, as the risk function needs to play a lead role in capital and business mix optimisation, informing corporate strategy. IFRS 9 is another game changer, making the impairment model predictive and 'risk-based'. These changes require a new partnership model between the risk and finance functions, first in capital management and now in IFRS 9. The paper discusses this necessary evolution of risk management, its strategic role in capital and business risk optimisation and its essential role in IFRS 9 production and governance. [ABSTRACT FROM AUTHOR]

This paper steps back from the focus on model risk in isolation and instead looks at the analytical infrastructure and operational environment in which models operate. Visualisation using analytical infrastructure diagrams provides a much quicker and more comprehensive understanding of the state of complexity of model dependencies and propagation of risk than textual documentation. Benefits of diagramming include knowledge sharing, a byproduct of identifying the true path of model risk and the environs through which it travels. Another benefit is identifying what and where are the analytical tools that mitigate or amplify the model risk downstream. Finally, the diagram provides a unique perspective to gauge whether the model-based production chain that feeds the business is unnecessarily complex or inefficient, or contains crucial gaps or redundancies. [ABSTRACT FROM AUTHOR]

Since the third Greek bailout in 2015, concerns about the long-term viability of the European single currency have diminished. For all the progress seen in the past decade, however, the structural and institutional fragilities underlying the euro remain unaddressed. This paper sets out these flaws in the context of past and proposed future reforms, including the current debate around an effective burden-sharing mechanism. Ultimately, the success of the single currency will depend on willingness to cede political sovereignty by member states and continued popular support for the project and associated social cohesion across the euro region. As such, the crisis may be dormant at the moment but, until these issues are addressed, it is far from over. [ABSTRACT FROM AUTHOR]

Do higher per capita incomes translate into higher financial inclusion in Africa? Our application of the Bayesian VAR estimation approach to the World Bank Development Indicators datasets for 15 African countries provides affirmative evidence to this question. Using a Bayesian VAR approach for a panel of 15 countries in Africa over the period from 2005 to 2014, the findings show that per capital incomes, deposit interest rate and the internet has positive and significant impact on financial inclusion. That is, higher per capital incomes is associated with higher levels of financial inclusion in Africa. It is, however, interesting to note that financial inclusion is having a positive but insignificant impact on per capita income. Moreover, the internet is coming out to be a significant variable indicating that more attention is required to be paid to developing internet access in Africa for the advancement of financial inclusion. The findings of this study should be of help to African central bank's policymakers and commercial bankers as they advance innovative approaches to enhance the involvement of excluded poor people in formal finance. [ABSTRACT FROM AUTHOR]

The article examines the current arrangements for regulating professional standards in the financial advice industries in Australia, New Zealand and Great Britain, as of July 2017. Topics discussed include regulation of conflicted remuneration of financial advisers; regulation of training and competence standards of financial advisers; and recommendations on further law and policy reforms that should be considered in these jurisdictions.

Nowadays, financial liberalization has eliminated the clear differentiation between the various types of financial institutions, thus, traditional banking has no choice but to sell many other financial products, and shift to the wealth management business model in order to provide customized financial planning for different customers. In Taiwan, the number of banks has increased greatly since private funds were allowed to invest the banking system, which has aggravated competition among banks, causing the financial institutions to provide more financial products to satisfy the needs of customers. Thus, the banks have paid more and more attention to the relevant wealth management business. Wealth management banking is an institution that provides financial service in response to the development of the financial market. It features independence, comprehensiveness, customization, and continuity, and has become a powerful competitor of banking, insurance, and securities industries in the financial market. However, how operators create win-win situations between enterprises and customers is an important factor to ensure the sustainable development of the financial management market in the future. Domestic and overseas wealth management banks offer a range of financial products for customers to select. In the past, scholars explored the businesses of wealth management of banks and consumers' preference for wealth management banks, but seldom discussed the critical success factors and strategies for wealth management banks. Thus, this study interviews experts from wealth management banking in order to understand acceptance of customers and the market, constructs success factors and a business strategy model for wealth management banking, and combines EMATEL with the ANP method to analyze the results. [ABSTRACT FROM AUTHOR]

Ghana's banking industry has undergone considerable transformation since 1988 as a result of the gradual but steady implementation of financial service reforms. The main purpose of implementing the financial reforms is to build a competitive and stable banking industry to enhance banks' efficiency and ultimately economic growth and development. Using annual (panel) data spanning from 2001 to 2010, this study investigates the degree of bank competition and their determinants in Ghana's banking indusrty using the fixed-effect model and two-step system GMM estimations. The results suggest that Ghana's banking industry is competitively weak. The findings also indicate that market power persistently exists in Ghana's banking industry. Furthermore, bank capitalization reduces bank market power and therefore increases bank competition in Ghana. However, there is no indication that bank size, fee income, loan loss provision ratio and rate of inflation have influence on bank competition in Ghana. [ABSTRACT FROM AUTHOR]

Notably, in Australia, market abuse practices like market manipulation and other market misconduct practices are expressly prohibited under the Corporations Act as amended by the Financial Services Reform Act. In the light of this, and for the purposes of this article, a brief historical analysis of the market manipulation prohibition will be presented first. Secondly, the available penalties and remedies for market manipulation are discussed. Thereafter, possible recommendations and significant Australian anti-market abuse enforcement approaches that may be utilised in South Africa are briefly stated. Lastly, concluding remarks are provided. [ABSTRACT FROM AUTHOR]

The economic growth and structural change currently taking place in sub-Saharan Africa relies on household enterprises to provide the main source of employment for the labour force. The financial sector will only contribute to inclusive growth if financial access can be extended to household enterprises. Promoting a more inclusive financial sector involves challenges for central banks in their role as regulators of the financial system. [ABSTRACT FROM AUTHOR]