The Regulation and Supervision of Banks around the World : A New Database
International consultants on bank regulation, and supervision for developing countries, often base their advice on how their home country does things, for lack of information on practice in other countries. Recommendations for reform have tended to...
| Main Authors: | , , |
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2001/04/1121223/regulation-supervision-banks-around-world-new-database http://hdl.handle.net/10986/19664 |
| Summary: | International consultants on bank
regulation, and supervision for developing countries, often
base their advice on how their home country does things, for
lack of information on practice in other countries.
Recommendations for reform have tended to be shaped by bias
rather than facts. To better inform advice about bank
regulation, and supervision, and to lower the marginal cost
of empirical research, the authors present, and discuss a
new, and comprehensive database on the regulation, and
supervision of banks in a hundred and seven countries. The
data, based on surveys sent to national bank regulatory,
supervisory authorities, are now available to researchers,
and policymakers around the world. The data cover such
aspects of banking as entry requirements, ownership
restrictions, capital requirements, activity restrictions,
external auditing requirements, characteristics of deposit
insurance schemes, loan classification and provisioning
requirements, accounting and disclosure requirements,
troubled bank resolution actions, and (uniquely) the quality
of supervisory personnel, and their actions. The database
permits users to learn how banks are currently regulated,
and supervised, and about bank structures, and deposit
insurance schemes, for a broad cross-section of countries.
In addition to describing the data, the authors show how
variables ay be grouped, and aggregated. They also show some
simple correlations among selected variables. In a
comparison paper ("Bank regulation and supervision:
What works best") studying the relationship between
differences in bank regulation and supervision, and bank
performance and stability, they conclude that: 1) Countries
with policies that promote private monitoring of banks, have
better bank performance, and more stability. Countries with
more generous deposit insurance schemes tend to have poorer
bank performance, and more bank fragility. 2)
Diversification of income streams, and loan portfolios - by
not restricting bank activities - also tends to improve
performance, and stability. (This works best when an active
securities market exists). Countries in which banks are
encouraged to diversify their portfolios, domestically and
internationally, suffer fewer crisis. |
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