[Book Review] The growth of shadow banking : a comparative institutional analysis

Abstract

The financial crisis of 2007/08 threw into sharp relief the complex system of credit intermediation that had developed over the span of several decades in global financial markets. Widely known as shadow banking, or market-based finance in technocratic discourse, the system disrupts the vertical-hierarchy organisation of bank-based finance into a chain of entities that together perform the activities of a traditional bank. Crucially, even though banks became heavily involved in it, this system remained outside of banking regulation as the activities which constituted it were kept off-balance sheet. What were the conditions that allowed for this, and what to make of so much national variation in exposure to the shadow banking system? These questions are at the heart of Matthias Thiemann’s The Growth of Shadow Banking: A Comparative Institutional Analysis.