We speak of the international financial crisis in the past tense, although we still suffer some of its consequences in the present. Its impact was widespread, but more intense in half of the world’s economies. Many countries have not yet recovered the trend production levels seen prior to the crisis, and it is possible that their potential growth has been affected in the medium and long term. It is difficult to know this a priori, as it is also difficult to estimate the magnitude of the possible deterioration.
The crisis had a financial origin. It developed over more than a decade under very favorable financial conditions and strong growth driven by economic and commercial integration worldwide. As a result of these two factors, the relationship between the size of the financial sector—comprised of banks and non-bank entities that offer financial services—and the real economy became heavily unbalanced in favor of the former. The most evident reflection was the high level reached by public and private debt from a historical perspective. The crisis required extreme and unconventional measures by authorities to combat it. However, the economic policy response was not uniform globally, except for the prominence achieved by monetary policy. Regulatory and supervisory changes applied almost exclusively to the banking sector have also been a common standard.
Changes in banking regulation have focused on solvency and prevention, with the explicit objective of preserving greater financial stability in the future. Efforts have also been made to ensure that accounting more faithfully reflects a bank’s situation. Furthermore, significant changes in corporate governance and conduct of entities have been approved. All these measures have sought to make banks safer and reinforce customer protection. Banks were not the cause of the past crisis, and they are now expected to act as a buffer against new potential financial risks. Everything indicates that they are prepared.
