On the other hand, in addition to being an important aspect of the financial sector the strengthened banks have also proved to save the countries from massive financial crises. For example, the financial sector of New Zealand is a vivid example to this. The banking industry in New Zealand accounted for around 90% of the assets of the financial market. The sector enjoyed growth like other banking systems in other countries while also sustained the economic crises because of the active system (Bollard, Hunt, and Hodgetts, 2011). Further, despite the evolution in the sector the weaknesses in the banking systems have also risen, that resultantly restrains the growth.
For dealing with the challenges in the banking sectors different regulations have been defined such as BASEL III etc. However, in the view of bankers and analyst, such regulations, such regulations are creating more hurdles in the growth than contributing to the improvement in the banking sector (OECD, 2013). Therefore, baking has to adapt to the changing market dynamics by strengthening its role in the financial markets. The need of adaption makes it mandatory for the sector to be sound as well so as to play a notable role in the economy. The banking sector is showing a shift in power and control across the globe.
Reported in the PwC findings, there will be a change in the authority in the world by 2050. This shift will be from the developed countries to the emerging markets of the world. The report countries that will be leading countries of the world include Brazil, Russia, China, India, Mexico, Indonesia, and Turkey as the seven largest economies in future (PwC, 2015).
More specifically, the China and India will be in the leading positions on GDP growth, purchasing power parity and the market exchange rate (Fensom, 2015). The future trend of the growth of India and China will be as follows: From the E7 countries, the four countries that form the BRIC acronym form an interesting trend. From the above graph it is also noted that Brazil and Russia tend to see growth in the short term duration; however, in the long run, the growth patterns will be mediated.
One primary reason for this decline for Brazil is the challenges that market has been facing since the middle of 2013. While, Russia is affected by its extensive dependence on the resources export, fiscal challenges, and fragile market system
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