01786cas a2200241 a 4500 AALejournalIMF006386 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451982756 1018-5941 BD-DhAAL BD-DhAAL Chan-Lau, Jorge. Regulatory Capital Charges for Too-Connected-to-Fail Institutions : A Practical Proposal / Jorge Chan-Lau. Washington, D.C. : International Monetary Fund, 2010. 1 online resource (25 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The recent financial crisis has highlighted once more that interconnectedness in the financial system is a major source of systemic risk. I suggest a practical way to levy regulatory capital charges based on the degree of interconnectedness among financial institutions. Namely, the charges are based on the institution's incremental contribution to systemic risk. The imposition of such capital charges could go a long way towards internalizing the negative externalities associated with too-connected-to-fail institutions and providing managerial incentives to strengthen an institution's solvency position, and avoid too much homogeneity and excessive reliance on the same counterparties in the financial industry. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2010/098 Full text available on IMF http://elibrary.imf.org/view/journals/001/2010/098/001.2010.issue-098-en.xml IMF e-Library