With great power comes great responsibility! FSI research on expanding supervisory remits
Some of our readers may be interested in new research from the Financial Stability Institute (FSI) on the growing accountability regimes of banking supervisors.
“Following the Great Financial Crisis, many supervisors have been tasked with a multitude of new objectives layered atop the core safety and soundness (S&S) mandate,” it states. “Some of these new remits are broad and driven by governmental priorities, clouding the demarcation between prudential and political spheres” and increasing the potential for conflict between S&S and other mandates.
As actions taken by supervisors in their expanded roles affect broader segments of society, the authors call for robust accountability regimes to assess their performance, suggesting various ways for legislators and banking authorities to foster accountability. These should be balanced by mechanisms to protect supervisors’ independence.
Read more here.
