GB30403 CURRENT GLOBAL FINANCIALCRISIS & ITS IMPLICATION ON IFI:   THE CASE OF US REGION          ROGER FEDERER           ...
OBJECTIVE  To identify the performance of international   financial institution.  To determine the causes of the global ...
PERFORMANCE OFINTERNATIONAL FINANCIAL      INSTITUTION Surveillance strategy Emerging market economies strategy Capacit...
CAUSES OF THE GLOBAL FINANCIAL CRISIS IN U.S Dramatic change in the ability to create new lines  of credit  • Cheap credi...
DISCUSSION AND FINDINGS  Causes have been highlighted by various   analysts.   •   An interest-based and debt-driven fina...
CONT…  •   Regulatory and supervisory failures  •   Transparency and disclosure  •   The role of rating agencies  •   The ...
DISCUSSION AND FINDINGS:IMPACTS TO THE FINANCIALINSTITUTIONS  Northern Rock   • Involve in home construction and mortgage...
DISCUSSION AND FINDINGS: IMPLICATION TO THE U.S       ECONOMY US had to bear the excess payment of expenses  using the fo...
Cont..  The expectation on short-term funding disruption   could have minimal ratings implications for   traditional and ...
RECOMMENDATIONS Regulating systematic risk Separating propriety trade Information transparency Creating a robust and r...
CONCLUSION• Many factor such as subprime lending crisis,  miss-pricing risk, under-pricing risk, become a  reason for the ...
Thank You  Q&A            12
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Roger federer (P. Slide) current global financial crisis and its implication on international financial institutions the case of us region

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Roger federer (P. Slide) current global financial crisis and its implication on international financial institutions the case of us region

  1. 1. GB30403 CURRENT GLOBAL FINANCIALCRISIS & ITS IMPLICATION ON IFI: THE CASE OF US REGION ROGER FEDERER 1
  2. 2. OBJECTIVE  To identify the performance of international financial institution.  To determine the causes of the global financial crisis in United States.  To identify the implications of global financial crisis in United States to the international financial institution. 2
  3. 3. PERFORMANCE OFINTERNATIONAL FINANCIAL INSTITUTION Surveillance strategy Emerging market economies strategy Capacity building strategy Governance strategy 3
  4. 4. CAUSES OF THE GLOBAL FINANCIAL CRISIS IN U.S Dramatic change in the ability to create new lines of credit • Cheap credit crated more money in the system and people wanted to spend that money Greed • Thousands of people took out loans larger than they could afford Housing slump • Depressed housing prices caused further complications 4
  5. 5. DISCUSSION AND FINDINGS  Causes have been highlighted by various analysts. • An interest-based and debt-driven financial system • Subprime mortgages and securitization • Monetary policy and low interest rates • Credit growth and predatory techniques by lenders • The complexity and mispricing of the risks of new products • Liquidity, leveraging and the fear of contagion 5
  6. 6. CONT… • Regulatory and supervisory failures • Transparency and disclosure • The role of rating agencies • The effect of financial globalization 6
  7. 7. DISCUSSION AND FINDINGS:IMPACTS TO THE FINANCIALINSTITUTIONS  Northern Rock • Involve in home construction and mortgage lending  Bankruptcy of Lehman Brothers • the financial crisis entered an acute phase marked by failures of prominent American and European banks and efforts by the American and European governments to rescue troubled financial institutions 7
  8. 8. DISCUSSION AND FINDINGS: IMPLICATION TO THE U.S ECONOMY US had to bear the excess payment of expenses using the foreign loans Declining in cost of household borrowing in the US Huge losses in securities due to loss of investor confidence on global stock markets and a decline in credit availability Effect to insurance companies 8
  9. 9. Cont..  The expectation on short-term funding disruption could have minimal ratings implications for traditional and alternative asset managers  The effect of global crisis has make the relationship between US and China become international attention 9
  10. 10. RECOMMENDATIONS Regulating systematic risk Separating propriety trade Information transparency Creating a robust and resilient financial system Capital flow management Internationalization of currencies 10
  11. 11. CONCLUSION• Many factor such as subprime lending crisis, miss-pricing risk, under-pricing risk, become a reason for the global financial crisis in U.S• Three steps to settle the global financial crisis: – establishing moral constraints on greed to maximize profit, wealth and consumption – strengthening market discipline that will exercise a restraint on leverage, excessive lending and derivatives – reforming the system’s structure combine with prudential regulation and supervision to prevent crises, 11
  12. 12. Thank You Q&A 12

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