Are Any Creditors

Abstract

Academics and policy-makers often argue for a harmonized international system to resolve the failures of large international financial institutions in order to reduce both systemic risk and the probability that an insolvency of a major bank will lead to a global economic collapse. Despite the perceived need for international coordination, major obstacles remain. The persistent failure to achieve any meaningful degree of international cooperation among regulators and lawmakers to handle failures of global financial institutions represents a perplexing island of discord in what is otherwise an ocean of international regulatory harmony. That is, there tends to be abundant international cooperation in the global financial sector and, ostensibly, increasing levels of international cooperation in banking regulation is a fundamental goal of U.S. national policy. One scholar recently observed, "there is extensive international regulatory co-operation in financial services regulation, co-ordinated through several global regulatory committees.