Crisis in the financial systems: a view from Ecuador

Abstract

The objective of this article is to analyze the role of the financial system in Ecuador based on different scientific theories that support the capitalization of financial institutions through the internal control evaluation process and the Basel III regulatory framework. The methodological approach responds to an exhaustive literature review and systematization of the main theories on the financial crisis considering the chronological sequence of events and processes of change over time from different events, sectors of society and variables. As a result, we obtained the contextualization of the financial system and the elements that affect them, recognizing the antecedents, contemporaneity, causes and consequences of the crisis. Concluding that the destabilization of the financial sector is a product of the impact of financial crises recognizing the importance of financial control processes in aspects of efficiency and profitability to mitigate serious economic consequences, hence the importance of considering the principles of the Basel III regulations promulgated by the Basel Committee on Banking Supervision to update the internal control processes, its governing regulations and its impact on the financial entity, enabling them to develop new strategies of financial intermediation.