Supervisory lessons: management traits of problem banks

Regulation and compliance

Poor management and ineffective supervision often trigger bank failures, and may outweigh macro factors as causal or aggravating conditions. Bad management and weak supervision are closely bound up together. Irrespective of the macro context, when supervision is lenient, good bankers may tend to become bad in a behavioural process that typically develops over four sequential stages.

First stage: incompetence

While there may be other causes, current losses and undercapitalisation or insolvency

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: