Dear Larisa Ivascu

Greetings,

Please find the attached file about your topic may be helpful for you.

Best Regards

One thing to be extremely careful about at the macro level is that if the government decides to work with the banking systems to flow money to the banks to have them provide assistance and relief to the citizens and small business there is a trap. Unless the government insists on signing contracts or enforceable documents with the banking institutions, they (banks) will use the money to reduce their risk profiles, sell off their bad debt and ensure that their balance sheets look better.

We observed this in the US and Canada during the mortgage-backed crisis in 2009-2010. Often in countries with banking systems either chartered (like in Canada) or regulated (loosely in the US), we will see very close relationships between regulators, legislators and bankers. This relationship cannot be relied on in a crisis and if the government wants action, it must use enforceable mechanisms.

Banking system does not a thing only statement. Central banks and other economic agents must act together. Another ımportant thing is law.

The banking system serves as backbone to the economic system. Commercial banks need to maintain a significant and adequate level of capital adequacy to avoid banks failures and protect the overall interest of the stakeholders. The stability of banking system depends on capital adequacy ratio (CAR), Management efficiency, Earning power, Liquidity etc.

If I were you, I would look at the world bank data; they publish the Z-score for a large number of countries' banking systems. It is an interesting measure.