Dealing with Distressed Financial Cooperatives : A Caribbean Experience
This working paper analyzes the restructuring of a distressed systemic financial cooperative in the Caribbean and draw lessons for supervisors or policy makers. It explains how the cooperative was intervened, restructured and revived in less than nine months. It analyses how a major contagion impact...
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| Format: | Publications & Research |
| Language: | en_US |
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World Bank, Washington, DC
2015
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| Online Access: | http://hdl.handle.net/10986/21630 |
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okr-10986-216302021-04-23T14:04:03Z Dealing with Distressed Financial Cooperatives : A Caribbean Experience Astaphan, Eleanor Cerruti, Caroline Gomez, Ruben Bail-in Building societies Building and loan association Communication strategy Cooperative members Credit union Distressed Regulatory framework financial cooperatives Financial supervisor Liquidity management measures Non-performing loans Resolution Restructuring Turnaround plan This working paper analyzes the restructuring of a distressed systemic financial cooperative in the Caribbean and draw lessons for supervisors or policy makers. It explains how the cooperative was intervened, restructured and revived in less than nine months. It analyses how a major contagion impact to the rest of the local financial system was averted with the supervisor building the necessary confidence from the members to recapitalize the cooperative. No public funding was disbursed. Success was never guaranteed during the intervention period and hinged on a comprehensive approach addressing liquidity, solvency and long-term viability issues. This paper attempts to draw some lessons for policymakers and financial supervisors who may be confronted with a similar situation. The first part describes the distressed institution and the challenges it presented to its supervisor; the second part analyzes the key components and timeframe of the restructuring strategy; the third part draws tentative lessons for supervisors. Importance of the document: while the World Bank has been and is involved in the development and restructuring of financial cooperative sectors, to the knowledge of the authors no case study of specific restructuring has ever been documented. This paper is designed to share knowledge on a specific case for Bank staff working on financial cooperatives, and also for supervisors of financial cooperatives or policy makers who may be confronted with a similar situation featured in the paper. 2015-03-25T18:16:22Z 2015-03-25T18:16:22Z 2015-03 http://hdl.handle.net/10986/21630 en_US CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research Publications & Research :: Working Paper Latin America & Caribbean St. Vincent and the Grenadines |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
en_US |
| topic |
Bail-in Building societies Building and loan association Communication strategy Cooperative members Credit union Distressed Regulatory framework financial cooperatives Financial supervisor Liquidity management measures Non-performing loans Resolution Restructuring Turnaround plan |
| spellingShingle |
Bail-in Building societies Building and loan association Communication strategy Cooperative members Credit union Distressed Regulatory framework financial cooperatives Financial supervisor Liquidity management measures Non-performing loans Resolution Restructuring Turnaround plan Astaphan, Eleanor Cerruti, Caroline Gomez, Ruben Dealing with Distressed Financial Cooperatives : A Caribbean Experience |
| geographic_facet |
Latin America & Caribbean St. Vincent and the Grenadines |
| description |
This working paper analyzes the restructuring of a distressed systemic financial cooperative in the Caribbean and draw lessons for supervisors or policy makers. It explains how the cooperative was intervened, restructured and revived in less than nine months. It analyses how a major contagion impact to the rest of the local financial system was averted with the supervisor building the necessary confidence from the members to recapitalize the cooperative. No public funding was disbursed. Success was never guaranteed during the intervention period and hinged on a comprehensive approach addressing liquidity, solvency and long-term viability issues.
This paper attempts to draw some lessons for policymakers and financial supervisors who may be confronted with a similar situation. The first part describes the distressed institution and the challenges it presented to its supervisor; the second part analyzes the key components and timeframe of the restructuring strategy; the third part draws tentative lessons for supervisors.
Importance of the document: while the World Bank has been and is involved in the development and restructuring of financial cooperative sectors, to the knowledge of the authors no case study of specific restructuring has ever been documented. This paper is designed to share knowledge on a specific case for Bank staff working on financial cooperatives, and also for supervisors of financial cooperatives or policy makers who may be confronted with a similar situation featured in the paper. |
| format |
Publications & Research |
| author |
Astaphan, Eleanor Cerruti, Caroline Gomez, Ruben |
| author_facet |
Astaphan, Eleanor Cerruti, Caroline Gomez, Ruben |
| author_sort |
Astaphan, Eleanor |
| title |
Dealing with Distressed Financial Cooperatives : A Caribbean Experience |
| title_short |
Dealing with Distressed Financial Cooperatives : A Caribbean Experience |
| title_full |
Dealing with Distressed Financial Cooperatives : A Caribbean Experience |
| title_fullStr |
Dealing with Distressed Financial Cooperatives : A Caribbean Experience |
| title_full_unstemmed |
Dealing with Distressed Financial Cooperatives : A Caribbean Experience |
| title_sort |
dealing with distressed financial cooperatives : a caribbean experience |
| publisher |
World Bank, Washington, DC |
| publishDate |
2015 |
| url |
http://hdl.handle.net/10986/21630 |
| _version_ |
1764448818286297088 |