Apr 01, 2013
March 25th 2013 - The Reserve Bank of India, today, signed Memoranda of Understanding (MoU) on “Supervisory Cooperation and Exchange of Supervisory Information” with Prudential Supervisory Authority (Autorité de Contrôle Prudentiel -ACP), Banque De France (BdF), France. The Reserve Bank has been signing the Memorandum of Understanding (MoU) with supervisors of other countries to promote greater co-operation and sharing of supervisory information between the two supervisors. With this, RBI has signed sixteen such MoUs.
The MOU was signed by Mr. Robert Ophele, Deputy Governor, BdF and Chairman of Board of the ACP and by Shri G. Jaganmohan Rao, Chief General Manager-in-Charge, Department of Banking Supervision, on behalf of RBI. The MoU was signed in the presence of Dr. K.C. Chakrabarty, Deputy Governor, and Mrs. LE Lorier, Deputy Governor, BdF. The function was held at College of Agricultural Banking, Pune.
The MoU provides a formal, yet legally non-binding, gateway of information between the supervisors. The MoU provides for sharing of information on health of the supervised entities, cooperation between the supervisors during on-site examinations, coordinated efforts during times of crises, frequent meetings between the supervisors, preserving the confidentiality of information shared. The MoU signing now does not mean that there was no cooperation earlier for exchange of information. Thus MoU is not an event but a process of strengthening the cooperation. This is done through pre-identified contact points as mentioned in the MoU which makes it easier for either supervisor to get in touch with his counterpart in a far more easier manner. The MoU does not override the laws of the land of either supervisor but only tries to build an environment of supervisory cooperation and coordination in complete adherence to such laws. The MoU is not just a document but a mechanism that aims to combine the supervisory strengths of both supervisors in overseeing the supervised entities and address the concerns in a timely manner.
Re-disseminated by The Asian Banker