Using Australia as an example, the following institutions are the main regulators of the financial system.

In Australia in the 1980s, there was a rise in non-bank financial institutions.  As financial entities had to be regulated to the same degree to prevent unfairness and artificial growth between sectors, either all sectors needed to be totally regulated or the banks partially deregulated – the latter option happened. 
This led to a shift from an asset management approach of restricting loans to the available deposit base to liability management involving borrowing from capital markets to meet demand for loans. 

Basel II capital adequacy requirements require banks to hold 8% of risk-weighted asset value.
Risks are –

• Operational risk – people and processes
• Credit risk – parties defaulting
• Market risk – movement in market prices
• Liquidity risk – mismatch of assets and liabilities