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Governance of Financial Institutions edited by Busch, Danny; Ferrarini, Guido; van Solinge, Gerard (31st January 2019)

Part III Ownership Structures, 14 State-Owned Financial Institutions

Johannes Adolff, Katja Langenbucher, Christina Skinner

From: Governance of Financial Institutions

Edited By: Danny Busch, Guido Ferrarini, Gerard van Solinge

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 23 July 2019

Subject(s):
Regulation of banks — Investment business

This chapter assesses whether State-ownership of financial institutions can further systemic stability and allocative efficiency. State-owned financial institutions are not common in most Western developed and capitalist economies. However, the United States and Germany may be seen as partial exceptions among their peer Western economies, with the United States' Government-Sponsored Enterprises (GSEs) and Germany’s State-owned banks. In the United States, the State-ownership conversation has been framed largely in terms of public utility regulation. Likewise, in Germany, where almost half of banking activities are carried out by ‘alternative banks’, there is a certain level of support for the notion that such ‘alternative’ ownership structures have their merits and that, therefore, a good mix of private and non-private ownership structures may well be the most promising approach for pursuing allocative efficiency and overall system stability.

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