Global Issues for the Financial Professional

Global Issues 1
Global Issues for the Financial Professional

Global Issues 2
Contents
Introduction.................................................................................................................................................3
Critical Review of the global issues and Risks for the Financial Institutions or Banks...............................4
Current Regulatory System.........................................................................................................................9
Improvements to the Current Regulation System of the Banking and Finance..........................................14
Conclusion.................................................................................................................................................16
References.................................................................................................................................................18

Global Issues 3
Introduction
The purpose of the report is to analyze the risks and challenges in the global scenario for the
banks and FIs from the global issues and the ways for the improvement in the legislative system
and regulations of the globalbanking system and financial operations.
The Global banking and financial system isthe large and wide framework of the legal agreements
between the global financial institutions or banks in order to facilitate the international financial
capital flows (both inflows and outflows) for the purpose of the trade financing or global
investment. It is headed by the banking and financial regulators, supervisors, and institutions
(like The World Bank, International Monetary Fund, the Central European Bank, and others) for
regulating and controlling the international banks, financial institutions, and insurance companies
at the superannuation level in the global industry.At the global level, it has been observed that
Central Bank is majorly responsible (in Europe, the UK, the USA, the UAE, except in the case of
Commonwealth Bank in Australia and Reserve Bank in India) for the legislative structures, legal
policies, and jurisdictions for the financial institutions (FIs) and banks in the most of the
countries. The banks in the global context involve the categories including the Central banks,
Merchant or Investment banks, Commercial banks, Retail banks, Cooperative banks, Public
banks, Industrial banks, and Development Banks(Reuvid, 2014).
This assignment looks at the major global issues, challenges, and risks for the banks and
financial institutions facing while operating in the regulatory and competitive environment at the
international level. The report also describes the legislation system, regulation policies, and
procedures for supervising and monitoring the banking and financial operations and the impact
of the regulatory changes on the operations in the global setting. Finally, the suggestions are

Global Issues 4
proposed for improving the regulatory environment in the global banking and financial scenario
for well organizing, managing, and controlling the banking and financial operations (Rael, 2017).
Critical Review of the global issues and Risks for the Financial Institutions or Banks
In the modern business environment of the International level, most of the banks or financial
institutions (FIs) face the complex global issue and challenges. PESTLE analysis is used to
analyze the impact of the external environmental changes or global issues, like the political
interferences, changing economic conditions, global financial crisis, changing customers’ needs
and preferences, technological risks, legal issues (taxation, laws and regulations), and
environmental factors on the banking operations, investments, financial policies, and insurance
operations of the banks, FIs, or insurance companies. For example, the increasing terror attacks
macroeconomic issues, rapid technology changes and increasing cyber-attacks, regulatory
changes, tax reforms, socio-cultural changes, and environmental pressures are such external
issues that may affect the financial policies, product planning and investment policies, financial
policies, and share market positioning, and foreign exchange policies of the banks and FIs while
operating at the international regulatory and competitive environment.Along with this, the banks
and FIS face issues, like the capital availability or finance sufficiency, quality of risk
management, increasing competition level from entry of new banks and FIs, stock market
changing trends, fiscal and monetary policy changes, and changing labor market conditions (like
the shortage of skilled labors) that can significantly influence their banking and financial
operations in the global setting (Stoner, 2012).The misconduct of the operations, Anti-money
Laundering, and IFRS 9 and IFRS 16, and non-performing loans are some growing challenges
for thebanks and FIs at the global scales.