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Short Course on Global Financial Regulation (4–8 November 2024)

 
Strategies for financial stability, integrity and consumer protection

All speakers have been a privilege to listen to and benefit from their experience. Thank you!

The short course on Global Financial Regulation is one-week intensive executive course. It concerns the regulatory framework for the global financial industry. It is designed to equip participants with a holistic view of interrelated regulatory strategies and tools used by regulators and supervisors around the world. After completing this course, participants are enabled to apply, debate and shape these strategies and tools, in relation to their own jurisdiction and in respect of the fast-evolving international framework.

Venue: LSE Law School, LSE Campus (central London, limited places)

Remote participation via videoconference admitted (limited places)

Course fee: £4,000.00

Academic Staff

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Philipp Paech is an Associate Professor of Law at LSE and has been an educator, researcher, and policy consultant specialising in the regulation and law of financial services for over 20 years. Since 2017, he has focused on the regulation of Digital Finance. He served as the chair of an EU Commission expert group on this subject (‘ROFIEG’), and the group's recommendations became a foundational document for the EU Digital Finance Strategy. Philipp teaches and conducts research at the London School of Economics and Political Science, where his educational portfolio includes master's courses in International Financial Regulation, International Financial Law and Digital Finance. Philipp is a Distinguished Global Professor of Law at Notre Dame University in the USA and is an attorney-at-law in Frankfurt, Germany. He consults for institutional clients in London and Frankfurt. His clients include the UK Foreign and Commonwealth Office, Santander, BVBA, the Central Bank of Ireland, and the European Parliament and the European Central Bank. 

See Dr Paech's full LSE profile.


 
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Elisabeth Noble is a Senior Policy Advisor and Team Leader at the European Banking Authority. She leads the EBA’s work on crypto-assets, DLT, and the platformisation of financial services and is the EBA coordinator for the European Forum for Innovation Facilitators. She represents the EBA in EU and international standard-setter policy work streams relating to FinTech, market-based finance, financial system interconnectedness, market access and the regulatory perimeter. Prior to joining the EBA, Elisabeth was at the UK’s finance ministry (2008-14) advising primarily on the response to the financial crisis and the post-crisis domestic and EU regulatory reforms, including the reforms to the regulatory architecture in the EU (Banking Union). Elisabeth has also spent some time in the private sector. Her current research interests relate to data access and competition metrics, platformisation and financial sector interconnectedness, and what she describes as ‘the next generation of financial conglomerates’ (new mixed activity groups, including BigTechs).

 

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Univ-Prof. Dr. Matthias Lehmann is a Professor of Law at Vienna University and at Radbout University, Nijmegen. He studied law at the University of Jena from 1991 to 1996. From 1997 to 1998, he attended post-graduate studies at the Université Panthéon-Assas in Paris. From 1999 to 2002, he was a judicial service trainee at the Kammergericht Berlin, which included an internship at the World Bank in Washington, DC. In 2003, he defended his doctoral thesis on the arbitrability of commercial disputes. From 2003 to 2004, he attended a Master’s programme at Columbia University. After a brief period at the University of Dresden, he returned to Columbia University in 2005 to start another doctoral thesis, which he completed in 2011. 

Meanwhile, he had finished his habilitation on the dematerialisation of securities at the University of Bayreuth in Germany and started his first position as a tenured professor in Halle-Wittenberg in 2009. In 2014, he moved to the University of Bonn, where he was the Director of the Institute of Private International Law. Since 2020, he has worked at the University of Vienna.

Matthias Lehmann has been a Visiting Academic at London School of Economics (LSE) and Oxford University. He regularly teaches as a Guest Professor at Sorbonne University, the University of Fribourg, and the University Pablo de Olavide in Seville.

 


 

Course Manager

Amanda Tinnams

Ms Amanda Tinnams, LSE Law School, manages our Short Courses with over twenty years' experience in the role.

 

How to apply

This course is open to participants with a minimum of three years of professional experience related to the financial services. Please complete the attached registration form and email the form to A.Tinnams@lse.ac.uk. Please note that available places (on campus and remote) are limited to enable optimal learning results.


Your LSE Law School certificate

Participants will earn an official LSE Law School certificate after successful completion of the course. A minimum attendance rate of 8/10 modules is expected. 

What will I learn?

The course shall enable participants from the UK, EU and other jurisdictions to understand, put into context and use the main techniques of financial regulation. Most regulatory policy areas are subject to continuous change, and the development of policy lines covering some current ‘hot topics’ is an on-going international exercise. This course enables participants to take part in the relevant debates. The combination of general approach (Modules 1, 2 and 10) and more specialised subject matters (all other Modules) allows participants to navigate through the panoply of existing and projected financial regulation without the necessity to cut through the thicket of very technical provisions. 

The four key practical aims of this course are, accordingly:

  • Enable participants to work with and conceptualise regulation on the basis of the ‘why’, ‘how’ and ‘who’, regardless of what concrete regulatory issue they will be looking at in the future.
  • Build an understanding of the framework withing which regulation keeps evolving, thus facilitating participants’ work with future changes.
  • Lay a solid general foundation regarding the most important policy areas in the field of financial regulation.
  • Enable participants to follow and shape the debate around financial markets regulation, be it their current role in the financial sector, as legal practitioner, central banker, policy maker, researcher or NGO-representative. 

Teaching schedule

Module 1

The Anatomy of the Financial Market and the rationales for its regulation

  • Mapping the financial market
  • Which market participants or activities are regulated?
  • Different types of risk: Counterparty risk, operational risk, political risk and systemic risk, etc, the principal/agent problem
  • Introduction to the 2008-2010 Financial Crisis
  • Market integrity as the main approach to ensure efficiency.
  • Regulatory rationales, including Market efficiency and growth; Systemic stability; Consumer Protection; ESG (environmental, social and governance-related goal)

Module 2

Key Strategies and Tools of Financial Regulation

  • Risk measurement and risk management
  • The efficiency of ‘Value at Risk’ and other risk models
  • Disclosures to retail and institutional clients
  • Financial resilience of intermediaries and infrastructures
  • Operational resilience of intermediaries and infrastructures
  • Rules imposing risk-conscious internal management
  • Governance and conduct

Module 3       

National, international and EU regulatory and supervisory structures

  • Financial Stability Board and G20, Basel Committee, FATF and CPMI
  • EU Institutions, ESAs and the ECB
  • National Supervisors and Regulators
  • Macro and integrated supervisory and regulatory structures

Module 4

Banking, financial stability, and the Basel accords

  • The role and importance of banks
  • Soundness, safety and resilience of banks
  • The role of regulatory capital
  • From Basel I to Basel II
  • Basel III to Basel IV: Post-crisis developments
  • From capital standards to leverage and liquidity standards
  • Developments to watch

Module 5   

Banking safety nets and shadow banking

  • The notion of systemic risk and systemic importance
  • Deposit insurance
  • Bank insolvency, bail out or bank resolution
  • The bank resolution toolbox (bail-in, good bank / bad bank)
  • Central bank financing and emergency liquidity
  • Shadow banking growth, risks and the new prudential standards
  • Developments to watch

Module 6       

Bank balance sheets and Credit Rating Agencies

  • Improving accounting standards and IFRS 9
  • Rating agencies’ pre-crisis implications
  • Inefficiencies and regulatory measures, EU CRA Regulation
  • Inefficiencies caused by platformisation
  • Emerging regulatory framework
  • Developments to watch

Module 7

Securities regulation

  • Regulation as enabler of efficient markets
  • Infrastructure regulation
  • Intermediary regulation
  • Product regulation
  • How to protect consumers
  • Developments to watch

Module 8

Derivatives and central clearing

  • Exchange-traded and bilateral derivatives
  • The 2008 financial crisis, interconnectedness, and central clearing as a solution
  • What is clearable?  Standardisation, netting and market efficiency
  • How central counterparties protect themselves: the default waterfall
  • Natural monopolies and the recovery and resolution agenda
  • Regulating bilateral OTC derivatives
  • Covid, the Ukraine conflict, and margin calls

Module 9      

Technology, payment regulation and digital finance

  • The PSD2 approach
  • APIs – how technology changes markets
  • Infrastructures and front-end providers
  • Efficiency and risk
  • Platformisation and the emergence of BigTech as a player
  • Decentralisation – a future theme?
  • Developments to watch

Module 10     

Looking into the future – Regulating in a complex world

  • Convergence of markets, convergence of regulation?
  • Global shocks and regulatory de-globalisation
  • Regulatory axioms to watch 

Course background

The course uses the past financial crises (including the DotCom, 2008 financial crisis and aftermath of the Covid-19 pandemic) as a starting point to discuss the fundamental regulatory challenges and the implications for legislators, regulators, and society as a whole in respect of the main segments of the financial market. Market practice keeps evolving, and the interplay between rationales, or goals, of regulation is constantly being adjusted to reflect new policy considerations. As a result, the rules applying to financial institutions keep changing continuously and globally. 

Regulation employs a set of specific strategies, such as risk modelling, disclosure, or structural-operational requirements, that are universal and whose logic remains largely the same. Similarly, regulation uses a number of tools to implement these strategies. These tools are equally universal and can be deployed in varying contexts. However, combinations of strategies and tools are being deployed in different ways to address emerging new or elevated risks, always constrained by the necessity to maintain adequate levels of market efficiency.

This short course identifies these global regulatory rationales, strategies and tools, and traces their application across specific policy areas, such as bank capital requirements, bank resolution, central clearing, securities regulation, consumer protection and digital payment. As a result, participants gain a holistic view of how financial regulation works, and how it applies in core policy areas. Participants will familiarise with relevant international standards, complemented by examples drawn from relevant UK, EU and US rules.

In a general part (Modules 1, 2 and 10), the course explores the axioms of policy making in the area of financial regulation, the ‘why, how & who’. Participants will discuss why policy choices are taken and how the underlying rationales can be categorised, notably market efficiency, systemic stability, consumer protection, crime prevention and ESG (environmental, social, governance) rationales.

The course will go on to identify and scrutinise the concepts that regulators use to achieve these policy goals, in particular building resilience into the system in different forms (capital buffers; operational and cyber resilience), the use of risk models and risk management mechanisms (financial risks; ESG risks), disclosure requirements (financial risks; ESG risks), or governance rules in relation to investors and counterparties. Participants will discuss various styles of supervision, built on the understanding that in practice regulators are taking a closer or more distant stance towards financial institutions.

Further, the general part of the course will consider the ‘who’ of financial regulation and financial supervision, in terms of who makes the rules and through which structures they are enforced. Two different problem spheres need to be identified here: first, the relationship between national, international, and European level; second the relationship of the traditional remit of financial regulation and supervision with other areas of regulation, such as competition or data law.

Lastly, the first part will explore the question of what the object of regulation is – entities, or risk-relevant activities. The traditional difficulty of navigating between entities-based regulation (e.g., ‘banks’) and activity/risk-based regulation (e.g., ‘credit intermediation’) turns out to become increasingly complex, as can be seen from the example of shadow banking, or, more recently, digital finance. This is part of the 10th module, in which the future of regulation in an uncertain world will be discussed.

In its specific part (all other modules), the course will test these themes in relation to concrete areas of regulation. It will bring participants in contact with some of the most discussed regulatory topics of recent years, spanning from the 2008 financial crisis to Covid-19 and public finances. The course will consider banking and financial stability, the Basel bank capital accords, bank resolution and shadow banking in depth. It will analyse how gate-keepers, such as rating agencies, or platforms, such as social media, can be relevant to financial stability. 

Relevant policy areas have all been substantially reinforced in recent years – however, critics note that the overhauled rules might substitute new problems for old ones and that the issues surrounding moral hazard, systemic stability and the special treatment afforded to banks by societies are still not solved in a satisfactory manner. 

Further, participants will begin to discuss the tectonic shifts caused by the ongoing digitalisation of finance and entry of so called BigTech into the financial market (which is also the subject of a separate course).

The course is internationally oriented and draws most of the examples from the standards set by the global committees (FSB, Basel, CPMI, etc.) and from the post-crisis rules adopted in the EU and the UK, with a few digressions and comparisons with the regulatory debate in the US, without focusing in detail on any specific jurisdiction. 

FAQs

How can I apply, and how long will it take to process my application?

Please submit your registration form to Amanda Tinnams: A.Tinnams@lse.ac.uk. The application form will be processed asap.

How to pay for the course  

Please specify on the registration form who the invoice should be addressed to supplying a Purchase Order number if required. Once full payment has been received your place on the course will be confirmed.  

Course timings

Delivery of the Short Course will be from 10am until 5pm daily.

Will I receive documentation?

You will receive a pack of annotated slides for each module for you to take home.

What are the teaching times?

The course day will run from 10am – 5pm with one hour for lunch

How do I get to the teaching room?

A campus map and room details will be provided.

Will there be food and drinks?

Refreshments will be provided throughout the day with a one hour lunch break

What if I have special needs or dietary requirements?

Please notify Amanda Tinnams Email: A.Tinnams@lse.ac.uk

Does LSE provide accommodation?

No, but LSE Accommodation may be able to assist. For further information, olease contact: Samantha Da Costa, Email: residences.faculty.accommodation@lse.ac.uk

Getting to LSE  

For further information, please use the weblink: https://www.lse.ac.uk/lse-information/travelling-to-lse


Cancellation policy

You may make a substitution, giving your place to a colleague, without charge, at any time before the start of the course but all cancellations must be confirmed in writing to Amanda Tinnams, (email A.Tinnams@lse.ac.uk). Cancellations received more than four weeks prior to the start of the course are not subject to any penalty. Cancellation received after that time incur the following penalties: two to four weeks 50% of the course fee, less than two weeks 100% of the course fee. If written notification is not received and you do not attend, the full course fee will be retained as a cancellation charge.

 

Course Administration

Please contact A.Tinnams@lse.ac.uk for any enquiries.