Precondition for a Successful Implementation of Supervisors' Primpt Corrective Action: Is There a Case for a Banking Standard in the EU?
AbstractOver the past years, several countries around the world have adopted a system of prudential prompt corrective action (PCA). the European Union countries are being encouraged to adopt PCA by policy analysts who explicitly call for its adoption. To date, most of the discussion on PCA has focussed on its overall merits. This paper focuses on the preconditions needed for the adoption of an effective PCA. These precondtions include conceptual elements such as a prudential supervisory focus on minimizing deposit insurance losses and mandating supervisory action as capital declines. These preconditions also include institutional aspects such as greater supervisory independence and authority, more effective resolution mechanisms and better methods of meauring capital.
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Bibliographic InfoPaper provided by Financial Markets Group in its series FMG Special Papers with number sp165.
Date of creation: Mar 2006
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Other versions of this item:
- María J. Nieto & Larry D. Wall, 2007. "Preconditions for a successful implementation of supervisors' Prompt Corrective Action: Is there a case for a banking standard in the EU?," Banco de Espaï¿½a Working Papers 0702, Banco de Espa�a.
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
- K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
- F20 - International Economics - - International Factor Movements and International Business - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-04-01 (All new papers)
- NEP-EEC-2006-04-01 (European Economics)
- NEP-FMK-2006-04-01 (Financial Markets)
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