WB discussion paper examining recent supervisory failings and recommending approaches to strengthen the effectiveness of supervision
World Bank paper discussing the reasons that regulation and supervision has proven ineffective in a number of countries, including a failure of supervisors to understand the business models of supervised institutions and the nature and extent of risk-taking that was occurring, and thus a failure to take appropriate remedial actions, such as forcing institutions to curb risky practices and increase capital requirements and loss provisions. Advocates a more proactive, interventionist supervisory approach with a strong on-site component, in order to understand the risks institutions are taking and to take appropriate actions when the risks are not properly managed.
Publisher:
International Organizations
Release date:
Jun 2009
Type:
Consultative, discussion and issues paper
Topics:
Supervisory framework, Crisis management and contingency planning, Early intervention and enforcement
Sectors:
Banking, Insurance, Securities
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