Good Supervision: Lessons from the Field
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Summary:
Keeping banks safe and sound hinges on good supervision. The bank failures of March 2023 precipitated questions about the effectiveness of supervision. This paper reflects on lessons learned from this banking turmoil and reviews global progress in delivering effective supervision over the past ten years. It finds progress in areas like risk monitoring, stress testing, and business model analysis. Yet, progress has also been hampered by deficiencies in supervisory approaches, techniques, tools, and (use of) corrective and sanctioning powers, as well as by unclear mandates, inadequate powers, and lack of independence and resources. Overcoming these deficiencies requires supervisors to improve their own performance and other policy makers to contribute to ensuring vigilant, independent and accountable supervision.
Series:
Working Paper No. 2023/181
Subject:
Bank supervision Basel Core Principles Corporate governance Economic sectors Financial regulation and supervision Financial sector policy and analysis Financial sector stability Stress testing
Frequency:
regular
English
Publication Date:
September 6, 2023
ISBN/ISSN:
9798400253782/1018-5941
Stock No:
WPIEA2023181
Format:
Paper
Pages:
34
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