Molly Preleski, financial services regulation expert shares her thoughts on how globalisation and the financial crisis have transformed the Basel Committee on Banking Supervision.
The article notes that the banking industry is undergoing a technology-driven transformation and this could have an impact on the work of the Committee.
Molly says: “The committee might be a bit behind the curve in terms in addressing future fintech risks. You’ve seen local regulators taking initial steps towards fintech and they’re outpacing global standards.”
“I think it’s important to monitor the impact of fintech on banks, because there are a lot of incumbents who have business models that could be completely disrupted by developments in fintech and that might affect bank stability.”
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Reflecting on the political pressures the committee faces Molly says that it will have to rethink how and when it reaches out to the public and the industry and the functioning of its working groups. It might also be called upon to interact earlier in the policymaking process.
Molly goes on to say that: “It could result in more consultations, calling for evidence earlier might be another way to go, anything that would demonstrate an openness to receiving feedback and input on policies. Obviously, that has to be balanced with the fact that the BCBS is an independent organisation.”
“I think it will be a slow process. I don’t see anything changing quickly in that regard.”