Abstract

In 2008, the world financial system experienced its worst crisis in at least a century, arguably the worst collapse in the history of finance capitalism. Specific national financial crises have been more severe in the past, such as the collapse of the United States banking system between 1929 and 1933. But what makes this crisis unique is that severe financial problems have erupted simultaneously in a number of countries, and that its economic impact was felt throughout the world as a result of the global economy's heightened interconnectedness. Deregulation of banking sectors in numerous geographies, particularly in advanced economies, defined the decade leading up to the crisis. The advent of the crisis ushered in a period of extensive banking reregulation, with a number of efforts put in place to rectify the flaws which became evident throughout the crisis. Yet, the dilemma persists: did post-financial crisis bank regulations actually make banks safer?

Keywords: Financial crisis, Deregulation, Dodd-Frank act, European system, Financial supervision