Financial regulation – who should do what?

Post crisis, many central banks’ financial stability mandates have been strengthened. And many now believe that, in order to better safeguard stability, central banks need a much better understanding of individual banks and the industry’s behaviour. It has, therefore, been argued that central banks should be charged with the prudential regulation of banks. However, for those that before the crisis were not tasked with regulation, there will be many cultural and operational factors to consider in taking on this role. Additionally, others argue that financial crises will remain nigh-on impossible to spot regardless of which institution is responsible for regulation, and that central banks’ failure to do so will damage their credibility. Central Banking ON AIR’s next web seminar, “Financial regulation – who should do what?”, will ask whether commentators are right to push for regulation to move back within the central bank. It will further examine how those involved can ensure the transition is as smooth as possible.