BB for setting Asian standard on banking supervision

Bangladesh Bank (BB) has proposed to develop an Asian standard on banking supervision and regulation like as European one in addition to Basel framework.
BB Deputy Governor SK Sur Chowdhury has floated the idea at Asia Regional Conference on Banking Supervision and Regulation held in Tokyo on September 14-15 last, said a BB press release Sunday.
It was a high-level regional conference on banking supervision and regulation where more than 20 counties were attended to discuss on enhancing supervision mechanism and formulating best fitted regulations for their jurisdictions. Resolution of a global bank and proposal for a similar standard in supervision for consolidation was appreciated at the discussion.
Regarding regulatory issues in cross-border and consolidated supervision, Sur Chowdhury said the national laws and regulations provide an adequate basis to support the consolidated supervision of banking groups, in the case of a parent bank and its subsidiaries.
"There is no international legal framework in case of failure of such banks though it has national fiscal responsibility and mandate since lender of last resort (LOLR), deposit insurance and resolution cost is involved for those banks," the deputy governor noted.
He also said the central bank of Bangladesh has the authority and framework to adequately vet and approve foreign banking entities seeking to establish a presence in Bangladesh or domestic banks planning on establishing branches or subsidiaries in foreign jurisdictions.
"One challenge in considering applications from foreign banks to establish a branch in Bangladesh is judging the adequacy of banking supervision in the home country," Chowdhury explained.
He also said the bank be adequately supervised in the home country; however, the sources of information on the adequacy of home country supervision may be limited, a news agency report said.
-SS