Most banking supervisory authorities are charged with multiple mandates in addition to their core responsibility of fostering the safety and soundness (S&S) of banks and the banking system.
Some of
these mandates may conflict with, or divert scarce supervisory resources
away from, the core S&S function. This paper takes stock of
supervisory mandates in 27 jurisdictions and explores how banking
supervisors interpret and navigate the S&S remit among other
objectives. We find that most surveyed authorities have at least 10 or
more objectives, accentuating potential tensions with their S&S
remit – whose scope and complexity have increased over time.
In this context, we outline a range of initiatives that some
supervisory authorities take to deliver on their core S&S remit,
while minimising potential tensions with other objectives. Nevertheless,
the staggering range of objectives imposed on supervisory authorities
highlights the extraordinary pressure placed on supervisors to juggle
multiple responsibilities and risks diluting their ability to deliver on
the core S&S mandate.
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© BIS - Bank for International Settlements
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