Financial regulators contend that weaker bank share prices - a global and Australian phenomenon - is a function of unrealistic shareholder return expectations."Recent bouts of market volatility in part reflect concerns that many banks have to do more to adjust their long-term business models to a lower growth and nominal interest rate environment, and strengthened international regulatory framework," the Financial Stability Board observes in a report for the G20 summit of global financial regulators in Hangzhou, China this weekend."Shareholders' return expectations are still adjusting to the improvements in bank resilience and the lower risk-free rates," the FSB argues. Both settings have been driven by its activist agenda since the crisis of 2007 and 2008. With an emphasis on increased capital and more detailed industry planning for failure, the FSB considers the global banking industry is operating effectively."Overall, banks have met the higher capital requirements without cutting back sharply on the level of lending," it says."Recent research and supervisory analysis indicate that higher bank capitalisation (within a reasonable range) has been associated with lower cost funding and more robust and higher lending over time, underscoring the importance of resilient banks in supporting the recovery."Following a sharp decline after the crisis, both total and bank lending growth have resumed in all regions, albeit at different paces," the FSB report says."The cost of financing to the real economy, whether by banks or debt markets, has remained generally low in recent years.""The exceptionally accommodative monetary policies coupled with the extended phase-in period of reforms and jurisdiction-specific factors may have contributed to this outcome."