Abstract
Throughout the global financial crisis of 2008–2009, many supervisors were accused of failing to intervene on time. In some cases, it was suggested that the close relationship between supervisors and the institutions they supervise had been an obstacle to timely intervention. This chapter offers some thoughts on developments in supervisory enforcement that can contribute towards a sound and stable financial system, drawing on the experience of the Monetary Authority of Singapore.
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Notes
- 1.
Regulation refers to the establishment of specific rules of behaviour. Supervision and enforcement means the more general monitoring of the behaviour of financial institutions and intervening when needed to ensure that they are acting in a manner consistent with the letter and spirit of the regulatory framework.
- 2.
MAS is the central bank and integrated financial supervisor overseeing the banking and insurance industries, and capital markets in Singapore.
- 3.
A key part of MAS’ supervisory framework is assessing the potential impact of a financial institution on the financial system, economy and Singapore’s reputation. The impact assessment covers aspects of the financial institution such as the relative size and importance in terms of share of activity in different markets; relative scale of retail reach in terms of number of customers and representatives, and type of business; and criticality to the stable functioning of and confidence in the financial system. Generally, the larger the institution’s intermediary role in critical financial markets or in the economy or the greater its reach to retail customers, the higher would be its assessed impact.
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© 2013 Springer-Verlag Berlin Heidelberg
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Lim, A.Y., Teo, S.L. (2013). Developments in Supervisory Enforcement. In: Kellermann, A., de Haan, J., de Vries, F. (eds) Financial Supervision in the 21st Century. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-36733-5_6
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DOI: https://doi.org/10.1007/978-3-642-36733-5_6
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Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-36732-8
Online ISBN: 978-3-642-36733-5
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