## Snapshot of Cross-Border Liquidity Flows in January and August 2012.

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---

### Introduction
- Following the significant consolidation of the Nigerian banking sector in 2005-10, Nigerian banks have been becoming more international.
- The note focuses on issues of cross-border coordination and provides policy recommendations for the Central Bank of Nigeria (CBN).
- Sections covered in the source: description of expansion and cross-border liquidity flows (Section II), supervisory cross-border coordination issues (Section III), and recommendations (Section IV).

### Cross-Border Expansion of Nigerian Banks
- Regulatory capital requirements:
  - Banks in Nigeria with international activities must maintain a capital adequacy ratio (CAR) of at least 15 percent.
  - Other Nigerian banks have a CAR requirement of 10 percent.
- Expansion and footprint:
  - After capitalization, several Nigerian banks expanded within West and Central Africa and more globally.
  - Some Nigerian banks established presence in more than 30 African countries.
  - At least two banks headquartered in Nigeria have subsidiaries across Africa and representative offices and/or subsidiaries in Europe.
  - One regional bank (with mostly Nigerian ownership) has headquarters in Togo, with its main subsidiary domiciled in Nigeria holding about 44 percent of the total assets.
  - That banking group is present in 32 countries across West and Central Africa, has a subsidiary in Europe and representative offices in London and the Middle East, and became one of the top five banks in Nigeria in terms of assets in 2011 after acquiring another Nigerian bank.
- Operations and constraints:
  - According to current Nigerian regulatory requirements, international subsidiaries of Nigerian banks operate as independent entities, and Nigerian parent banks cannot provide capital to capitalize their subsidiaries abroad.
- Cross-border liquidity behavior:
  - Several Nigerian banks are net cross-border liquidity providers; some borrow from the United Kingdom and the United States and place liquidity in African subsidiaries.
  - Motivations include carry trades (borrowing under low interest rates in Europe or the United States and placing liquidity in countries with higher interest rates, e.g., buying local treasury bills) and meeting local CAR or minimum capital requirements where flows could be booked temporarily as capital.
  - Cross-border liquidity flows fluctuated month to month in 2012; CBN data show flows were higher in August than in January 2012.
  - The amount and range of destinations of cross-border liquidity flows increased during 2012.
  - The CBN did not have information on cross-border liquidity flows from the large regional banking group headquartered outside Nigeria that it supervises as a stand-alone bank; hence the presented figures exclude that group's subsidiary.

### Cross-Border Coordination Issues
- CBN institutional arrangements:
  - CBN created a unit in the Banking Supervision Department (BSD) dedicated to supervision of cross-border institutions.
  - CBN put in place a Framework for the Supervision of Cross-Border Institutions, providing guidance on supervision of offshore subsidiaries and supervisory cooperation with host countries.
  - Bilateral MoUs have been established with a significant number of jurisdictions with Nigerian banking presence.
  - MoUs contain details on information sharing, on-site examination confidentiality of shared information, and consolidated supervision, but do not cover crisis management and resolution.
  - Establishment of MoUs with host regulatory authorities has become a pre-requisite for initiation of Nigerian banking operations in foreign jurisdictions.
- Colleges of supervisors and gaps:
  - There is a general “college of supervisors” in the West African Monetary Zone (WAMZ) which meets quarterly, but participation is by country representation rather than bank-by-bank.
  - There are no specific colleges of supervisors for Nigerian banks with foreign subsidiaries, nor for the regional bank headquartered in Togo (Ecobank).
  - CBN supervisors lack capacity to verify information submitted by certain subsidiaries regarding intra-group liquidity and capital flows across borders.
  - Supervisory weaknesses and data reliability problems exist in some jurisdictions where Nigerian banks operate; reporting requirements and off-site monitoring systems vary.
  - CBN has opened its supervisory training program for foreign inspectors and is promoting harmonization of reporting through adoption of Electronic Financial Analysis and Surveillance System (eFASS).
- Ecobank-specific issues:
  - Ecobank is headquartered in Lomé; the regional supervisory authority in Abidjan is responsible for exercising consolidated supervision.
  - Togolese operations account for a small share of the group’s asset and deposit base while the Nigerian subsidiary accounts for the largest single share of the bank’s activities.
  - CBN supervises the Nigerian operations on a stand-alone basis and may lack good communications or MoUs with supervisors of other subsidiaries of the same group.
  - Among the shareholders of Ecobank are the International Finance Corporation and a large South African financial institution.
- CBN circular and its effects:
  - Circular BSD/DIR/GEN/RFS/05/024, May 18, 2012, restricts Nigerian banks’ capacity to capitalize their foreign subsidiaries by prohibiting parent Nigerian banks from providing further capital outlays to foreign subsidiaries to augment their capital needs.
  - Banks were encouraged to consider options such as mergers and acquisitions and sourcing fresh capital from host country capital markets.
  - Where such capital could not be replaced, parent banks were required to submit capital strategies by June 30, 2012.
  - CBN stated it would allow for exemptions for well-capitalized parent banks, but the Circular does not seem to provide for any exemptions.
  - The Circular does not prevent Nigerian operations of subsidiaries of foreign banks from moving capital upstream to headquarters or to other subsidiaries on the foreign parent.

### Recommendations
- Overall approach:
  - CBN should further enhance cross-border supervision, including home-host coordination and cooperation.
  - CBN is encouraged to learn from recent external developments, including supervisory colleges for individual banks and regional initiatives such as the Vienna Initiative (Box 1).
- Specific recommendations (verbatim and preserved ordering):
  - The CBN should withdraw the CBN Circular BSD/DIR/GEN/RFS/05/024 (dated May 18, 2012). Instead, it should consider capitalization needs on a case-by-case basis and rely on prudential requirements to control the outflow of capital or require specific bank measures to avoid any deleterious impact.
  - The CBN should expand the scope of cross-border MoUs to include crisis management. Ideally, home and host authorities would pre-agree on key aspects, such as exchange of information, decision-making powers, and procedures. These arrangements should also cover possible future divestment of foreign undertakings.
  - It is important that the interests of smaller host countries, where Nigerian banks have a dominant presence, but whose share of group assets and deposits is fairly low, are taken into consideration.
  - In its capacity as home supervisor, the CBN should take the lead in initiating a dialogue with host authorities on establishing colleges of supervisors for those Nigerian banks that have a significant cross-border presence. Within such colleges, crisis management groups can be set up to ensure that relevant information is shared and recovery and resolution plans prepared on a group wide basis.
  - The current “college” from WAMZ might be adapted to form bank specific colleges and perhaps have a coordinating role across such colleges.
  - Despite supervising a subsidiary only, the CBN should initiate discussions with the regional banking supervisor responsible for supervising Togolese banks to establish a supervisory college for Ecobank, as the Nigerian operations of this group are the largest in terms of group assets and deposits, and the Nigerian subsidiary is one of the five largest banks in Nigeria.
  - The CBN should participate actively on the colleges of those overseas banks that have Nigerian subsidiaries. In such cases where it has not been invited to participate in the college, it should seek an invitation—not just to assess the broader standing of the particular subsidiary but also to get a better understanding of how colleges of supervisors can work.
  - The CBN should initiate mechanisms for the mutual recognition of decisions made in other jurisdictions in the context of insolvency or reorganization proceedings, subject to conditions such as non-discriminatory treatment of foreign creditors and reciprocity.
  - The CBN should consider establishing ex-ante burden sharing arrangements that would enable home and host authorities to act quickly during a crisis and avoid protracted negotiations, but not to an extent that it implicitly cedes sovereign rights and compromises domestic depositors and creditors.
  - The CBN should improve data collection and granularity on cross-border transactions and funding flows of Nigerian international banks as well as subsidiaries of foreign banks by institution and by each transaction, making sure that the supervisors would be able to verify details of each cross-border transaction, as well as repayment of liquidity placements abroad.

### 18.      The CBN would gain from learning from successful international practices in

#### Rationale for regional coordination
- The CBN would gain from learning from successful international practices in safeguarding cross-border capital and liquidity flows.
- Benefits listed:
  - Enhance private-public initiatives towards better cross-border regulation and supervision.
  - Increase transparency of regional pan-African banks.
  - Facilitate cross-border banking supervision and regulation, crisis prevention and management, and monitoring of systemic risk.
- A regional coordination group would be effective by bringing together private and public institutions to maintain and enhance financial stability in the region.
- There is room to create common regulatory requirements related to cross-border capital and liquidity flows and regional banks.

#### Proposal: regional coordination group (modelled on the Vienna Initiative)
- The CBN may consider taking initiative in establishing a regional coordination group similar to the Vienna Initiative (Box 1).
- Suggested membership for a regional African initiative:
  - World Bank
  - IMF
  - IFC
  - African Development Bank (AfDB)
  - Representatives (CEOs) of large pan-African banks, such as Ecobank and the United Bank of Africa (UBA), and other important regional banks
  - European and U.S. banks with significant presence in African countries
  - Central banks of countries involved would also have their representatives in such a group
- Rationale for this composition: the Vienna Initiative has been successful because of close cooperation among international financial institutions (IFIs) and large regionally important international banks (for example, Reiffeizen).

#### Box 1 — The European Bank Coordination “Vienna” Initiative (EBCI): structure and aims
- Origin and purpose:
  - In November 2008, banks with large presence in emerging Europe called for a coordinated response to funding problems in emerging Europe.
  - The Vienna Initiative was created as a coordination platform for multinational banks, home- and host-country supervisors, fiscal authorities, the IMF, and development institutions to safeguard continued commitment of parent banks to their subsidiaries and to guarantee macroeconomic stability in emerging Europe.
  - Launched at the height of the financial crisis to coordinate crisis management and resolution for large cross-border bank groups systemically important in emerging Europe.
- Created in January 2009; participants included:
  - International financial institutions: IMF, the EBRD, European Investment Bank (EIB), and the World Bank (WB)
  - European institutions: European Commission and the European Central Bank as observer
  - Home and host country regulatory and fiscal authorities of large bank groups
  - Largest bank groups operating in the region
- Aims:
  - Prevent a large-scale and uncoordinated withdrawal of cross-border bank groups from the region.
  - Ensure parent bank groups publicly commit to maintain their exposures and recapitalize their subsidiaries, as part of balance-of-payments support where IMC/EC macroeconomic support programs were necessary (Bosnia and Herzegovina, Hungary, Latvia, Romania, and Serbia).
  - Ensure national support packages of cross-border bank groups benefit their subsidiaries in emerging Europe and avoid a home bias.
  - Agree on basic crisis management and crisis resolution principles in the region:
    - Host country authorities: appropriate macroeconomic policies; liquidity support in local currency irrespective of bank ownership; support deposit insurance schemes.
    - Parent bank groups and home country authorities: provide funding in foreign exchange and recapitalize subsidiaries.
  - Strengthen cross-border regulatory cooperation and information sharing in the context of IMC/EC-supported programs and beyond.

#### Outcomes and lessons from the Vienna Initiative
- Crisis-management phase achievements:
  - Helped resolve the “prisoner’s dilemma.” External sustainability required foreign banks to remain engaged in countries where their subsidiaries operated.
  - Commitments were upheld: parent banks maintained agreed exposure limits; subsidiaries were recapitalized according to stress-testing results.
  - Consultations allowed for “controlled” deleveraging: during regular reviews exposure commitments were reduced on a country-by-country basis, permitting banks to increase room to manage liquidity internationally while still supporting external sustainability.
  - The Vienna Initiative informed and supported policy decisions in both home and host countries:
    - Banking sector support packages of home country authorities were allowed for use in subsidiaries of bank groups.
    - Host country monetary policy tools such as reserve requirements could be loosened to address weak demand with assurances that additional liquidity would not be used for capital flight.
  - Used to examine joint private-public sector issues: initial subjects included development of local currency and capital markets and the role banks can play in helping with the absorption of EU structural funds.

#### Applicability to Africa and policy implications
- Applicability rationale:
  - Captures a specific geographical area with countries sharing common risks, common private sector actors, and different regulatory and supervisory frameworks.
  - Financial policy challenges can recur in a region; having such an initiative in place makes it easier to coordinate and mitigate risks and emerging problems.
  - An initiative of this kind can enhance the effectiveness of international financial institution involvement in the region.
- Policy recommendation summary:
  - Consider establishing a regional coordination group modeled on the Vienna Initiative to:
    - Coordinate private-public responses to cross-border bank stress.
    - Secure commitments from parent banks to sustain subsidiaries.
    - Enable common regulatory requirements related to cross-border capital and liquidity flows.
    - Improve cross-border supervisory cooperation and information sharing.

*Source: _cr13142 - 1. Snapshot of Cross-Border Liquidity Flows in January and August 2012. / _cr13142 - 18.      The CBN would gain from learning from successful international practices in*

### 1. Snapshot of Cross-Border Liquidity Flows in January and August 2012. ............................ 6

### Snapshot of Cross-Border Liquidity Flows in January and August 2012.

### Introduction
- Following the significant consolidation of the Nigerian banking sector in 2005-10, Nigerian banks have been becoming more international.
- The note focuses on issues of cross-border coordination and provides policy recommendations for the Central Bank of Nigeria (CBN).
- Sections covered in the source: description of expansion and cross-border liquidity flows (Section II), supervisory cross-border coordination issues (Section III), and recommendations (Section IV).

### Cross-Border Expansion of Nigerian Banks
- Regulatory capital requirements:
  - Banks in Nigeria with international activities must maintain a capital adequacy ratio (CAR) of at least 15 percent.
  - Other Nigerian banks have a CAR requirement of 10 percent.
- Expansion and footprint:
  - After capitalization, several Nigerian banks expanded within West and Central Africa and more globally.
  - Some Nigerian banks established presence in more than 30 African countries.
  - At least two banks headquartered in Nigeria have subsidiaries across Africa and representative offices and/or subsidiaries in Europe.
  - One regional bank (with mostly Nigerian ownership) has headquarters in Togo, with its main subsidiary domiciled in Nigeria holding about 44 percent of the total assets.
  - That banking group is present in 32 countries across West and Central Africa, has a subsidiary in Europe and representative offices in London and the Middle East, and became one of the top five banks in Nigeria in terms of assets in 2011 after acquiring another Nigerian bank.
- Operations and constraints:
  - According to current Nigerian regulatory requirements, international subsidiaries of Nigerian banks operate as independent entities, and Nigerian parent banks cannot provide capital to capitalize their subsidiaries abroad.
- Cross-border liquidity behavior:
  - Several Nigerian banks are net cross-border liquidity providers; some borrow from the United Kingdom and the United States and place liquidity in African subsidiaries.
  - Motivations include carry trades (borrowing under low interest rates in Europe or the United States and placing liquidity in countries with higher interest rates, e.g., buying local treasury bills) and meeting local CAR or minimum capital requirements where flows could be booked temporarily as capital.
  - Cross-border liquidity flows fluctuated month to month in 2012; CBN data show flows were higher in August than in January 2012.
  - The amount and range of destinations of cross-border liquidity flows increased during 2012.
  - The CBN did not have information on cross-border liquidity flows from the large regional banking group headquartered outside Nigeria that it supervises as a stand-alone bank; hence the presented figures exclude that group's subsidiary.

### Cross-Border Coordination Issues
- CBN institutional arrangements:
  - CBN created a unit in the Banking Supervision Department (BSD) dedicated to supervision of cross-border institutions.
  - CBN put in place a Framework for the Supervision of Cross-Border Institutions, providing guidance on supervision of offshore subsidiaries and supervisory cooperation with host countries.
  - Bilateral MoUs have been established with a significant number of jurisdictions with Nigerian banking presence.
  - MoUs contain details on information sharing, on-site examination confidentiality of shared information, and consolidated supervision, but do not cover crisis management and resolution.
  - Establishment of MoUs with host regulatory authorities has become a pre-requisite for initiation of Nigerian banking operations in foreign jurisdictions.
- Colleges of supervisors and gaps:
  - There is a general “college of supervisors” in the West African Monetary Zone (WAMZ) which meets quarterly, but participation is by country representation rather than bank-by-bank.
  - There are no specific colleges of supervisors for Nigerian banks with foreign subsidiaries, nor for the regional bank headquartered in Togo (Ecobank).
  - CBN supervisors lack capacity to verify information submitted by certain subsidiaries regarding intra-group liquidity and capital flows across borders.
  - Supervisory weaknesses and data reliability problems exist in some jurisdictions where Nigerian banks operate; reporting requirements and off-site monitoring systems vary.
  - CBN has opened its supervisory training program for foreign inspectors and is promoting harmonization of reporting through adoption of Electronic Financial Analysis and Surveillance System (eFASS).
- Ecobank-specific issues:
  - Ecobank is headquartered in Lomé; the regional supervisory authority in Abidjan is responsible for exercising consolidated supervision.
  - Togolese operations account for a small share of the group’s asset and deposit base while the Nigerian subsidiary accounts for the largest single share of the bank’s activities.
  - CBN supervises the Nigerian operations on a stand-alone basis and may lack good communications or MoUs with supervisors of other subsidiaries of the same group.
  - Among the shareholders of Ecobank are the International Finance Corporation and a large South African financial institution.
- CBN circular and its effects:
  - Circular BSD/DIR/GEN/RFS/05/024, May 18, 2012, restricts Nigerian banks’ capacity to capitalize their foreign subsidiaries by prohibiting parent Nigerian banks from providing further capital outlays to foreign subsidiaries to augment their capital needs.
  - Banks were encouraged to consider options such as mergers and acquisitions and sourcing fresh capital from host country capital markets.
  - Where such capital could not be replaced, parent banks were required to submit capital strategies by June 30, 2012.
  - CBN stated it would allow for exemptions for well-capitalized parent banks, but the Circular does not seem to provide for any exemptions.
  - The Circular does not prevent Nigerian operations of subsidiaries of foreign banks from moving capital upstream to headquarters or to other subsidiaries on the foreign parent.

### Recommendations
- Overall approach:
  - CBN should further enhance cross-border supervision, including home-host coordination and cooperation.
  - CBN is encouraged to learn from recent external developments, including supervisory colleges for individual banks and regional initiatives such as the Vienna Initiative (Box 1).
- Specific recommendations (verbatim and preserved ordering):
  - The CBN should withdraw the CBN Circular BSD/DIR/GEN/RFS/05/024 (dated May 18, 2012). Instead, it should consider capitalization needs on a case-by-case basis and rely on prudential requirements to control the outflow of capital or require specific bank measures to avoid any deleterious impact.
  - The CBN should expand the scope of cross-border MoUs to include crisis management. Ideally, home and host authorities would pre-agree on key aspects, such as exchange of information, decision-making powers, and procedures. These arrangements should also cover possible future divestment of foreign undertakings.
  - It is important that the interests of smaller host countries, where Nigerian banks have a dominant presence, but whose share of group assets and deposits is fairly low, are taken into consideration.
  - In its capacity as home supervisor, the CBN should take the lead in initiating a dialogue with host authorities on establishing colleges of supervisors for those Nigerian banks that have a significant cross-border presence. Within such colleges, crisis management groups can be set up to ensure that relevant information is shared and recovery and resolution plans prepared on a group wide basis.
  - The current “college” from WAMZ might be adapted to form bank specific colleges and perhaps have a coordinating role across such colleges.
  - Despite supervising a subsidiary only, the CBN should initiate discussions with the regional banking supervisor responsible for supervising Togolese banks to establish a supervisory college for Ecobank, as the Nigerian operations of this group are the largest in terms of group assets and deposits, and the Nigerian subsidiary is one of the five largest banks in Nigeria.
  - The CBN should participate actively on the colleges of those overseas banks that have Nigerian subsidiaries. In such cases where it has not been invited to participate in the college, it should seek an invitation—not just to assess the broader standing of the particular subsidiary but also to get a better understanding of how colleges of supervisors can work.
  - The CBN should initiate mechanisms for the mutual recognition of decisions made in other jurisdictions in the context of insolvency or reorganization proceedings, subject to conditions such as non-discriminatory treatment of foreign creditors and reciprocity.
  - The CBN should consider establishing ex-ante burden sharing arrangements that would enable home and host authorities to act quickly during a crisis and avoid protracted negotiations, but not to an extent that it implicitly cedes sovereign rights and compromises domestic depositors and creditors.
  - The CBN should improve data collection and granularity on cross-border transactions and funding flows of Nigerian international banks as well as subsidiaries of foreign banks by institution and by each transaction, making sure that the supervisors would be able to verify details of each cross-border transaction, as well as repayment of liquidity placements abroad.

*Source: _cr13142 - 1. Snapshot of Cross-Border Liquidity Flows in January and August 2012.*

### 18.      The CBN would gain from learning from successful international practices in

### _cr13142 - 18.      The CBN would gain from learning from successful international practices in

### Rationale for regional coordination
- The CBN would gain from learning from successful international practices in safeguarding cross-border capital and liquidity flows.
- Benefits listed:
  - Enhance private-public initiatives towards better cross-border regulation and supervision.
  - Increase transparency of regional pan-African banks.
  - Facilitate cross-border banking supervision and regulation, crisis prevention and management, and monitoring of systemic risk.
- A regional coordination group would be effective by bringing together private and public institutions to maintain and enhance financial stability in the region.
- There is room to create common regulatory requirements related to cross-border capital and liquidity flows and regional banks.

### Proposal: regional coordination group (modelled on the Vienna Initiative)
- The CBN may consider taking initiative in establishing a regional coordination group similar to the Vienna Initiative (Box 1).
- Suggested membership for a regional African initiative:
  - World Bank
  - IMF
  - IFC
  - African Development Bank (AfDB)
  - Representatives (CEOs) of large pan-African banks, such as Ecobank and the United Bank of Africa (UBA), and other important regional banks
  - European and U.S. banks with significant presence in African countries
  - Central banks of countries involved would also have their representatives in such a group
- Rationale for this composition: the Vienna Initiative has been successful because of close cooperation among international financial institutions (IFIs) and large regionally important international banks (for example, Reiffeizen).

### Box 1 — The European Bank Coordination “Vienna” Initiative (EBCI): structure and aims
- Origin and purpose:
  - In November 2008, banks with large presence in emerging Europe called for a coordinated response to funding problems in emerging Europe.
  - The Vienna Initiative was created as a coordination platform for multinational banks, home- and host-country supervisors, fiscal authorities, the IMF, and development institutions to safeguard continued commitment of parent banks to their subsidiaries and to guarantee macroeconomic stability in emerging Europe.
  - Launched at the height of the financial crisis to coordinate crisis management and resolution for large cross-border bank groups systemically important in emerging Europe.
- Created in January 2009; participants included:
  - International financial institutions: IMF, the EBRD, European Investment Bank (EIB), and the World Bank (WB)
  - European institutions: European Commission and the European Central Bank as observer
  - Home and host country regulatory and fiscal authorities of large bank groups
  - Largest bank groups operating in the region
- Aims:
  - Prevent a large-scale and uncoordinated withdrawal of cross-border bank groups from the region.
  - Ensure parent bank groups publicly commit to maintain their exposures and recapitalize their subsidiaries, as part of balance-of-payments support where IMC/EC macroeconomic support programs were necessary (Bosnia and Herzegovina, Hungary, Latvia, Romania, and Serbia).
  - Ensure national support packages of cross-border bank groups benefit their subsidiaries in emerging Europe and avoid a home bias.
  - Agree on basic crisis management and crisis resolution principles in the region:
    - Host country authorities: appropriate macroeconomic policies; liquidity support in local currency irrespective of bank ownership; support deposit insurance schemes.
    - Parent bank groups and home country authorities: provide funding in foreign exchange and recapitalize subsidiaries.
  - Strengthen cross-border regulatory cooperation and information sharing in the context of IMC/EC-supported programs and beyond.

### Outcomes and lessons from the Vienna Initiative
- Crisis-management phase achievements:
  - Helped resolve the “prisoner’s dilemma.” External sustainability required foreign banks to remain engaged in countries where their subsidiaries operated.
  - Commitments were upheld: parent banks maintained agreed exposure limits; subsidiaries were recapitalized according to stress-testing results.
  - Consultations allowed for “controlled” deleveraging: during regular reviews exposure commitments were reduced on a country-by-country basis, permitting banks to increase room to manage liquidity internationally while still supporting external sustainability.
  - The Vienna Initiative informed and supported policy decisions in both home and host countries:
    - Banking sector support packages of home country authorities were allowed for use in subsidiaries of bank groups.
    - Host country monetary policy tools such as reserve requirements could be loosened to address weak demand with assurances that additional liquidity would not be used for capital flight.
  - Used to examine joint private-public sector issues: initial subjects included development of local currency and capital markets and the role banks can play in helping with the absorption of EU structural funds.

### Applicability to Africa and policy implications
- Applicability rationale:
  - Captures a specific geographical area with countries sharing common risks, common private sector actors, and different regulatory and supervisory frameworks.
  - Financial policy challenges can recur in a region; having such an initiative in place makes it easier to coordinate and mitigate risks and emerging problems.
  - An initiative of this kind can enhance the effectiveness of international financial institution involvement in the region.
- Policy recommendation summary:
  - Consider establishing a regional coordination group modeled on the Vienna Initiative to:
    - Coordinate private-public responses to cross-border bank stress.
    - Secure commitments from parent banks to sustain subsidiaries.
    - Enable common regulatory requirements related to cross-border capital and liquidity flows.
    - Improve cross-border supervisory cooperation and information sharing.

*Source: _cr13142 - 18.      The CBN would gain from learning from successful international practices in*

---


_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2013/_cr13142.pdf_