Directions of improvement of multinational banks’ credit activity regulations in terms of debt-type economy

Abstract

Research background: Amidst deepening economic internationalization and financial globalization, multinational banks remain the most important financial intermediaries in the international debt capital market. By ensuring the cross-border movement and redistribution of credit resources, multinational banks’ credit activities lead to the accumulation of external indebtedness in the host countries. Purpose of the article: The purpose of the article is to substantiate scientific and practical recommendations for improving multinational banks’ credit activities regulations in order to minimize their negative impact on the level of external indebtedness and the formation of the debt-type economy in the host countries. Methods: Methods of abstraction, systematization and generalization, as well as system approach have been used in our research. Findings & Value added: A hierarchical system of multinational banks’ credit activity regulation, which includes institutional-subjective (the level of multinational banks themselves), macro-regional (the level of the home country and host countries), mega- and meta-regional, and global levels have been proposed. Scientific and practical approaches to regulating multinational banks’ credit activities, which are based on the introduction of special regulatory measures by the countries with debt-type economies (transformation of external financing sources, revision of forms of credit cooperation with multinational banks, intensification of inclusion in the processes of securitization of credit relations, introduction of a system of macroprudential regulation instruments, increasing the level of international liquidity), have been developed.

Keywords

• debt-type economy;
• regulation;
• multinational banks;
• external indebtedness