Financial Sector Reforms

  • Evaluation
  • Design

This area includes the analysis of the performance of financial systems and the design of modernization programs. We view financial systems as a single market where integrated financial groups (bank, insurance, securities, pension funds) operate even if the existing legal framework calls for separated markets, institutions, and instruments. In Peru, they led a reform process intended to modernize bank supervision (1997-2001). The process included changes in supervisory processes with the objectives of implementing a risk-based approach to the supervision of financial entities and a more effective control of the risks of the Peruvian Banking System. The new regulations, supervisory processes, and domestic and cross-border coordination mechanisms adopted strengthened the control of credit, market, liquidity, as well as operational and country risks of banks and banking groups. They also allowed supervision of financial conglomerates on a consolidated basis. The strengthening of human resources by developing a comprehensive program of recruitment and training of bank supervisors, improvements to supervisory information systems for bank supervision, and the introduction of new accounting rules based on international accounting standards were also part of the reforming process led by our consultants.
We have also participated in similar programs in Bolivia, Costa Rica, Ecuador, El Salvador, Guatemala, Panama, Peru, the Dominican Republic, and Venezuela.