Dominic Barton & Roberto Newell 
Dangerous Markets 
Managing in Financial Crises

A corporate guide to crisis management in volatile financialmarkets

Current financial crises in Argentina, Japan, and Turkey arebeing played out on the front pages of newspapers, and these arejust the most recent financial crises that have rolled across theglobe in the last decade and whose far-reaching impact hurtsbusiness around the world. Dangerous Markets: Managing in Financial Crises recognizes that no global corporation orfinancial institution can afford to ignore the potential of afinancial storm and will help top management and financialprofessionals navigate through this often disastrous maze.

While many books discuss financial crises and theirramifications, none has presented an action plan for managing thesestorms–until now. Dangerous Markets: Managing in Financial Crises presents a method that allows executives and financialprofessionals to recognize the warning signs of a financial crisisand act appropriately before the situation spirals out of control.Based on years of research and practice in cleaning up the mess, Mc Kinsey consultants Barton, Newell, and Wilson reveal the warningsigns of potential financial catastrophes and provide uniqueprinciples that can be followed to shape and manage a strategy forsurvival.

Tabela de Conteúdo

Preface.

Why Manage Financial Crises Proactively?

Why We Wrote Dangerous Markets.

Acknowledgments.

CHAPTER 1: Introduction to Dangerous Markets.

Financial Storms Are Destabilizing.

Financial Crises Can Be Understood, Anticipated, Managed, and Prevented.

What This Book Is and Is Not.

Who Needs to Read Dangerous Markets?

Part I: Understanding Financial Crises.

Part II: Earning the Right to Win.

Part III: Managing Unique Banking Risks.

Part IV: Building for the Future.

PART I: Understanding Financial Crises.

CHAPTER 2: Recognizing New Global Market Realities.

Increasing Risk of Financial Crises.

Why Financial Crises Are on the Rise.

You Can Run, But You Can’t Hide From Crises.

Looking Ahead.

CHAPTER 3: Using Crisis Dynamics to See Growing Risks.

The Chronology of a Crisis.

The Dynamics of a Financial Crisis.

The Corporate Sector: Assessing Value Destruction.

The Financial Sector: Banks in Distress.

Understanding the Impact of Macroeconomic Catalysts, Foreign Funding, and Asset Bubbles.

Conclusions and Outlook for Future Crises.

Appendix 3.1: Ten Warning Signs of a Financial Crisis.

Appendix 3.2: Estimating Value Destruction in the Economy.

Appendix 3.3: Why Corporate Sectors Underperform in Crisis Economies.

PART II: Earning the Right to Win.

CHAPTER 4: Managing the First Hundred Days.

Taking Five Tactical Steps When a Crisis Hits.

Developing a Crisis Management Approach.

Managing the CEO Agenda.

Appendix 4.1: Painting the Picture of a Financial Crisis.

Appendix 4.2: How Companies Can Strengthen Funding Before a Crisis.

Appendix 4.3: Using Scenario Planning in Financial Crises.

CHAPTER 5: Capturing Strategic Opportunities After the Storm.

Recognizing Significant Opportunities in a Crisis.

Moving from Boundaries to Greater Degrees of Freedom.

Executing Successfully to Capture Crisis Opportunities.

Appendix 5.1: Leveraging Strategic Opportunities in Financial Crises: The Successful Story of NCNB.

PART III: Managing Unique Banking Risks.

CHAPTER 6: Driving Successful Bank Turnarounds.

Ensuring Turnaround Success: Seven Management Actions.

Mellon Bank’s Successful Turnaround.

Christiana Bank’s Successful Turnaround.

Filanbanco’s Failed Turnaround.

Government Stewardship of Troubled Banks.

Government’s Role in Bank Turnaround Strategies.

Appendix 6.1: Building a Rationale for Official Support in a Financial Crisis.

CHAPTER 7: Minimizing Costs Through NPL Recovery Excellence.

Developing World-Class NPL Recovery Capabilities.

Special Issues Raised When NPLs Are Managed by Governments.

Management Lessons: Good Banks/Bad Banks in Scandinavia.

PART IV: Building for the Future.

CHAPTER 8: Strengthening System Safeguards.

Moving to Global Standards for Corporate Governance.

Adopting Better Accounting Standards.

Developing Capital Markets.

Resetting Regulatory Regimes.

Building an Effective Legal Foundation.

Appendix 8.1: Sixteen Elements of Good Corporate Governance.

Appendix 8.2: Singapore’s Development as an International Financial Center.

Appendix 8.3: The Discipline of the Market for Corporate Control: Issues for CEOs.

CHAPTER 9: Designing a New, Market-Driven Financial Architecture.

Recognizing the Limitations of Current Standards and Approaches.

Enhancing the Private Sector’s Role in Setting Standards to Reduce the Risk of Future Crises.

Appendix 9.1: FSF Compendium of Standards.

Endnotes.

Glossary.

Index.

Sobre o autor

DOMINIC BARTON is a director with Mc Kinsey & Company andmanaging partner of the Firm’s Korea practice. He also is a leaderin the Firm’s financial institutions practice. Barton has advisedthe Korean Financial Supervisory Commission on restructuring theirbanking system as well as strategized with the Monetary Authorityof Singapore. He led a major Mc Kinsey study on how to transformcompanies into sustainably high performers and has led numerousstudies for private and public sector clients in the financialsector. He holds an M. Phil. in economics from Oxford University, where he was a Rhodes Scholar, and a BA in economics from the University of British Columbia.

ROBERTO NEWELL is a former director at Mc Kinsey & Company wherehe led projects for governments and private sector clients infinancial crisis. Dr. Newell has served clients immersed infinancial crises throughout the Americas, including Argentina, Colombia, Ecuador, Mexico, the United States, and Venezuela. Heholds a BA and MA from the Universidad de las Americas in Mexicoand a Ph D in economics from the University of Texas at Austin. AMexican citizen, he is currently CEO of FESSA (Fondo de las Empresas Expropiadas del Sector Azucarero), a Mexican governmententity charged with turning around and privatizing twenty-sevenfailed sugar mills. With Luis Rubio Frieberg, Newell wrote anaward-winning book on Mexico’s financial crisis of the 1980s, entitled Mexico’s Dilemma: The Political Origins of Economic Crisis.

GREGORY WILSON is a principal in Mc Kinsey & Company’s Washington, D.C. office, specializing in strategic issues thataffect private and public sector clients in the financial servicesindustry. Wilson has worked on financial sector restructuringaround the world, including many recent crisis countries in Asiaand South America, and has conducted numerous client studies onpolicy, strategic, regulatory, and structural issues. He holds a BAin history, and politics and government from Ohio Wesleyan University. From 1974-1976 he attended the Fletcher School of Lawand Diplomacy where he studied international business and law.Prior to joining Mc Kinsey, Wilson served as Deputy Assistant Secretary for Financial Institutions at the U.S. Treasury Department during the U.S. savings and loan crisis.