The first step is to recall the main concepts of risk, providing some in-depth analysis of liquidity, exchange and sovereign risks. Risks are then connected to the specificities of financial contracts, markets and financial intermediaries. Given these premises, the qualitative and quantitative dynamics of the financial systems in the last decades is examined. This evolution is then connected to the string of financial crises that have characterised the financial systems all over the world, both idiosyncratic and systemic ones. The relevant features of the crises and the associated costs are analysed. We then pass to the analysis of some case studies of idiosyncratic crises. Before discussing systemic crises, the theory of Minsky on financial fragility and instability is presented, both for the macro dynamics and for the endogenous production of financial fragility taking into account the stock-flow structures of economic units. The policy implications of Minsky’s theory are highlighted. We then pass to the study of three systemic crises: the foreign debt crisis of Latin America in the 1980s, the South-East Asia crisis of the late 1990s, and the recent crisis started in 2007. These crises are analysed with the help of empirical material and adopting the Minskyan approach. The previous analyses serve as the basis to understand policy interventions, not just fiscal and monetary ones, but also in the field of financial regulation. The last part of the course starts with a historical and analytical analysis of the various forms of regulation, with particular emphasis on bank regulation. We then pass to the evolution of the regulation promoted by the Basel Committee on Banking Supervision, connecting its various phases with relation to the lections derived from the crises. We conclude with the analysis of the more recent institutional and regulatory reforms promoted by the European Union.