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Abstract

The purpose of this paper is to analyze the negative impact of “mundialisation” on the banking sector. It is evident that the global banking system has become more fragile. As a response to progressing instability in financial architecture, policy makers have become interested in better understanding of high sensitivity in the financial sector, particularly in banks. One of the basic techniques for calculating banking fragility is stress - testing. In order to estimate the potentially harmful and unpredictable effects on their transactions, banks have created stress - testing models, which turned out to be an indispensable tool in the bank supervision process. Banking regulators have started using improved stress - testing methods for estimating aggregate risk and for defining the adequate capital level in the banking sector.

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