The Bank of International Settlements as a think tank for financial policy-making

Abstract

The Bank of International Settlements (BIS) is known to be the ‘bank of central banks’ and a confidential place where central bankers meet to discuss policies. However, this contribution shows that it is also far more. Economic research and policy-making are closely connected within the BIS. Researchers and analysts provide knowledge for financial regulation and introduce new approaches to policy-makers who meet within the BIS-hosted bodies, such as the Basel Committee of Banking Supervision. The Monetary and Economic Department of the BIS operates like a think tank in the field of financial policy-making. This is exemplified by the introduction of macroprudential regulation, a new approach that originated within the BIS. By combining post-structural discourse theory with the concept of discourse coalition, this paper shows how macroprudential regulation became a frame of reference promising to maintain financial stability and how the BIS benefits from this.

Envisaging global balance-sheet capitalism: The Bank for International Settlements as a collective organic intellectual

“…The upper management of the BIS is composed of officials with prior high-level experience in central banks, international organizations, finance ministries and private finance. Today, it pursues four core roles: (1) providing banking services for member central banks; (2) encouraging and facilitating international cooperation and knowledge sharing in central banking and financial regulation; (3) producing data, theory and analysis on the international monetary and financial system, a function carried out by the Monetary and Economic Department, which acts, as Westermeier (2018) notes, as a ‘think tank’ for central banks; and (4) driving ‘responsible innovation’ in monetary and financial systems, a task entrusted to the recently founded Innovation Hub, with outposts (at the time of writing) in Switzerland, Hong Kong, London, Stockholm and Singapore, and plans for expansion to Toronto, Frankfurt and Paris in the near future.…”

“…As Helleiner (1994) notes, ‘in the wake of each crisis central bankers met within the BIS to construct an increasingly sophisticated set of norms, rules, and decision-making procedures for handling and preventing future crises’ (p. 17). In these respects, the BIS has been a crucial coordinating and organizing force in the development of the global epistemic community of central bankers in the era of financial globalization (Baker 2015; Braun 2020; King 2005; Rosenhek 2013; Westermeier 2018). Furthermore, not only did this work of the BIS assistcentral banks in cooperating by altering expectations, making information available, and institutionalizing patterns of cooperation.…”

“…Literature from International Political Economy (IPE) has provided penetrating insights into the political-economic, institutional and ideational processes and dynamics shaping the emergence of governance regimes of neoliberal financial capitalism (e.g. Braun et al 2021;Gabor 2015;Konings 2012;Krippner 2011) and the role of the BIS therein (Andersson 2016;Baker, 2013aBaker, , 2013bBaker, , 2015Baker, , 2018Ban et al 2016;Westermeier 2018). 1 To the best of my knowledge, however, there have been no detailed studies of the BIS' wider vision of what constitutes the 'proper' management of 21st-century capitalism, and only limited attention has been paid to the ideological underpinnings (Ozgercin 2012) and limitations (Baker 2018) of the organization's discourse.…”

“…The Bank for International Settlements (BIS) is an international organization that influences central bank and financial regulation policy globally. As a small critical literature has detailed (Andersson 2016; Baker 2013b; Ban et al 2016; Westermeier 2018), the BIS has been influential in shaping the debate on post-crisis financial regulatory reforms through its advocacy of the ‘macroprudential approach’ to financial regulation – that is, pre-emptive intervention to manage systemic risk (Borio 2011) – and its role in the formulation of the Basel III accord, a set of global standards on bank regulation. More broadly, motivated by the shock of the Great Financial Crisis (GFC) of 2007–2009, and seeking to prevent it from happening again, the BIS has advocated for a transformation in how the global financial system is visualized and understood (Baker 2018; Tooze 2018).…”

Political security and finance – A post-crisis and post-disciplinary perspective

“…Lastly, it should be noted that these changes within governance rationales are foremost discussed and disputed within an epistemic community of central bankers that have gained prominence following the crisis (Westermeier 2018a). Connecting to the historical role of central banks, it is remarkable that they have-once again-reestablished their pivotal role in the relation of state(s) and financial markets.…”