The research arm of BBVA, the Spanish bank, has just released a comparative study on resolution regimes in Latin America, assessing the extent to which they comply with the Key Attributes of Effective Resolution Regimes for Financial Institutions.
“Latin America has ample experience in dealing with banking and financial crises, for example during the 1980s and 1990s. As a result of this, the laws of many countries in the region comprise detailed resolution regimes whose main goal is to deal with banking failures in an orderly way, preserving financial stability and avoiding bank runs. As opposed to Europe and the USA, Latin America has barely been affected by the recent financial crisis. As such, countries from this region do not feel the rush to implement regulatory reforms in this field. Currently, the majority of the resolution frameworks are very advanced although they are not fully aligned with the KAs.”
The Key Attributes were agreed after the financial crisis with a view to empowering the regulators to rehabilitate or wind down failing banks without using government resources.
Read the full article at www.bbvaresearch.com/en/publicaciones/resolution-regimes-in-latin-america/