The Role of the US Domestic BHCs in Achieving Financial Stability in the US in the Context of International Banking Regulation Reform

Financial stability is a key factor underlying sustainable economic growth and overall prosperity. As banks are the major actors in the financial market it is of considerable importance to estimate their contribution to achieving financial stability. The aim of this paper is to estimate the influence of BHCs’ activities on the financial stability in the context of international banking regulation reform. For this purpose, a mixed-methods research design with an emphasis on statistical correlation analysis based on both primary and secondary data was implemented to test 3 hypotheses: 1) international banking regulation reform has a statistically significant effect on the role of the BHC in achieving US financial stability; 2) BHCs’ compliance with prudential requirements for capital adequacy, liquidity and increasing resilience to cyclical fluctuations of the economy has a positive impact on the achievement of financial stability in the US; 3) the role of the largest US BHCs in achieving financial stability is different from that of large US BHCs on financial stability. The study confirmed hypotheses 1 and 3 as highly probable, while hypothesis 2 was confirmed only partially.