Supervising Large Complex Banking Organizations

Laurence H. Meyer

in Prudential Supervision

Published by University of Chicago Press

Published in print January 2002 | ISBN: 9780226531885
Published online February 2013 | e-ISBN: 9780226531939 | DOI:
Supervising Large Complex Banking Organizations

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This chapter presents a speech by Lawrence Meyer, a governor of the Federal Reserve System, which addresses the issue of how the Federal Reserve System is approaching the supervision of what he calls large complex banking organizations. Meyer's speech indicates that the Federal Reserve has groups that are engaged in intensive study of how best to supervise these large organizations and that the Federal Reserve's thinking is taking two directions. First, there is a growing emphasis on a supervisory approach in which examiners focus on the adequacy of banks' risk management and internal models to determine the amount of capital needed to cope with market and credit risk. Second, there is increased emphasis on the use of market discipline to create the right incentives for these large, complex banking organizations.

Keywords: Federal Reserve System; bank regulation; complex banking organizations; bank supervision; risk management; market discipline

Chapter.  4034 words. 

Subjects: Financial Markets

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