Today, the Basel Committee on Banking Supervision issued a set of principles aimed at promoting and strengthening the operation of supervisory colleges, set forth in the final version of its paper entitled “Good Practice Principles on Supervisory Colleges.” Supervisory colleges support the supervision of international banking groups, and the principles are intended to "strengthen international cooperation and supervision of internationally active banks."
The paper outlines the following principles and expectations of supervisory colleges:
- Utilization of multiple or variable sub-structures based upon the characteristics of the banking groups under consideration as well as the particular needs of home and host supervisors;
- Leadership and governance by home supervisors in designing and implementing the operation of colleges to encourage effective supervision of international banking groups;
- Guidance by the supervisory colleges on the types of information to exchange, subject to legal, confidentiality and market sensitivity considerations, and the range of communication channels available for effective information sharing;
- Promotion of specific areas of collaborative work among supervisors, at different hierarchies within the college to facilitate effective consolidated supervision; and
- Accounting for the latest developments and policymaking work in response to the financial crisis, including management planning and sharing information relevant to macroprudential analysis.
This paper supplements prior guidance issued by the Basel Committee on cross-border cooperation and information-sharing by outlining expectations for both home and host supervisors in relation to supervisory college objectives, governance, communication and information, as well as potential areas for collaborative work.