Central Bank introduced tight control

We had previously written about the intentions of the Central Bank to tighten the supervision of the risks of financial organizations. Today, a more detailed scheme for the implementation of the regulator plans has already become known, which will be discussed further.

First of all, the changes will affect the procedure for checking banking organizations: now all information from the inspectors will immediately enter the controlling units directly during the process itself (previously information was submitted at the end of the audit). More likely the innovations will serve as a faster response of the regulator’s specialists to possible violations and exclude the likelihood of “pulling the tails” by violators and the use of various kinds of schemes to conceal the results of opaque activity.

Correction of the functioning of the supervision bodies will be carried out at all levels, starting with territorial institutions and ending with the leading apparatus. The information exchange chain about the results of the inspections will look as follows: the auditors (literally in real time) are informed by information to employees of the regional inspection, the regional service transfers information to the interregional surveillance institution, and that – the main regulatory body. In addition, in parallel, the same information enters the supervisory unit of the territorial administration of the Central Bank and the Department of Banking Supervision (DBN) in the central apparatus. Such “multi -layer” and instant informing is a kind of insurance from concealment and loss of information about violations at one of the levels, in local inspections.

Among other things, the new verification system will make it possible immediately after identifying problems in the activities of a separate financial structure to eliminate shortcomings. For this, the regulatory authorities will hold a meeting with the owners and governing employees of the bank in order to discuss the ways of momentary correction of errors and violations in work with the subsequent control of the intended process.

The described supervision scheme is supposed to be applied in relation to financial institutions of the second circle of control, which include two hundred major representatives of banking activities. Many experts agree that the measures to tighten control will benefit the domestic banking sector and “heal” it.