Safe and Sound Financial Systems

What can the Latin American countries do to both strengthen their domestic banking systems and reap the full benefits of integration into a global economy and liberalized capital markets? The region's fragile financial systems have had difficulty adapting to the new environment ushered in by economic and financial reforms. The surge of banking problems in the region has been compared in depth and coverage to that experienced in the pre-reform period of the early 1980s. The author of this volume explores alternatives available to policy makers who address three key policy issues: what is the most effective regulatory and supervisory framework for the region? An effective system must draw from the advantages of regulatory processes in industrial countries but also take into account economic and financial features specific to the area; how should financial markets be structured?; and what is the most appropriate financial safety net for the region, incluuding deposit insurance systems and lender of last resort facilities?