| Description |
1 online resource (33 pages) : illustrations |
| Series |
IMF working paper, 2227-8885 ; WP/06/242 |
|
IMF working paper ; WP/06/242.
|
| Contents |
Contents -- I. INTRODUCTION -- II. LITERATURE REVIEW -- III. METHODOLOGY AND DATA -- IV. THE RESULTS -- V. CONCLUSIONS -- References |
| Summary |
This paper studies whether compliance with the Basel Core Principles for Effective Banking Supervision (BCPs) improves bank soundness. The authors find a significant and positive relationship between bank soundness (measured with Moody's financial strength ratings) and compliance with principles related to information provision2. Specifically, countries that require banks to regularly and accurately report their financial data to regulators and market participants have sounder banks. This relationship is robust to controlling for broad indexes of institutional quality, macroeconomic variables, sovereign ratings, and reverse causality. Measuring soundness through Z-scores yields similar results. These findings emphasize the importance of transparency in making supervisory processes effective and strengthening market discipline. Countries aiming to upgrade banking regulation and supervision should consider giving priority to information provision over other elements of the core principles |
| Bibliography |
Includes bibliographical references |
| Notes |
Print version record |
| SUBJECT |
Basil Core Principles
|
| Subject |
Banks and banking -- State supervision.
|
|
Banks and banking -- State supervision
|
| Form |
Electronic book
|
| Author |
Detragiache, Enrica
|
|
Tressel, Thierry
|
|
IMF Institute.
|
|
World Bank.
|
| ISBN |
1283511746 |
|
9781283511742 |
|
9781451909555 |
|
1451909551 |
|
