This paper studies access regulation to international large-value payment systems when banking supervision is a national task. We focus on the choice between allowing net settlement or imposing real-time gross settlement. As a novel feature, the communication between the supervisors is endogenized. It is shown that the national supervisors' incentives are not perfectly aligned when deciding upon the settlement method. As a result, systemic risk is excessive under public regulation. Still, leaving access regulation to the private banks can only be optimal if they have superior information about the risk of their foreign counterparty in the settlement system.
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