Chair Professor at the University of Zurich and Visiting Professor at the University of Hong Kong

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Supervision of Financial Conglomerates New
Approaches in the Aftermath of the Financial
Crisis?
Prof. Dr. Rolf H. Weber

• Chair Professor at the University of Zurich and
  Visiting Professor at the University of Hong Kong

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• Phenomenon of the Financial Conglomerates
• Principles of Financial Conglomerates Regulation
• Rationale for Regulating Financial Conglomerates
• Supervisory Backbone
• International Supervisory Fundaments
• Organizational Requirements
• Quantitative Requirements
• Qualitative Requirements
• New Supervisory Issues
• Fundamental Questions for Future Financial
  Conglomerates Supervision

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Concept
Phenomenon of Financial Conglomerates
Models for Groups
Impact of Financial Crises
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Definitions / Notions
Concept
Universal Banking / Functional Banking
Parent Concept of Allfinance
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Integrated Model
Parent-Subsidiary Model
Group Models
Holding Company Model
Horizontal Group Model
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Consolidation v. Conglomeration
Impact of Finacial Crises
Too-big-to-fail
Predominant Leg
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Potential Problems
Rationale for Regulating Financial Conglomerates
Sector-Based Differences
Common Characteristics
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Double Gearing / Excessive Leveraging
Contagion
Potential Problems
Lack of Transparency
Conflicts of Interest
Systematic Risks
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Banking and Securities Dealing
Sector-Based Differences
Banking and Insurance
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Fitness Tests
Common Characteristics
Compliance
Risk Management
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Types of Supervision
Supervisory Backbone
Boundaries to Financial Conglomeration
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Stand-alone or Solo-Basis Supervision
Supervision of Homogenous Financial Groups
Types of Supervision
Supervision of Financial Conglomerates
Mixed-Activities Groups
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Limits Imposed on the Banking Sector
Boundaries to Financial Conglomeration
Limits Imposed on the Insurance Sector
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BIS BCBS
Tripartite Goup Joint Forum
Organizations
IAIS
International Supervisory Fundaments
IOSCO
Summits Washington, London, Pittsburgh
Reaction to Crisis
FSB, BCBS, IAIS
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Accounting and Capital Adequacy
Consolidated Risk Supervision
Conglomerate-Wide Supervision I
Quantitative Requirements
Concept of Economic Unity
Liquidity Requirements
Intra-Group Transactions
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Adequate Group Organization
Risk Management
Conglomerate-Wide Supervision II
Qualitative Requirements
Group-wide Reporting
Fitness and Propriety Tests
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Problems
Lead Supervisor
International Recommendations
New Supervisory Issues
Problems
Too-big-to-fail
International Discussions
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Fundamental Questions for Future Financial
Conglomerates Supervisions

• Is There Anything like a Concept of Convergence?
• How should the Principle Same Business, Same
  Rights, Same Rules be Applied?
• Can Some Entities Remain Unregulated and
  Unsupervised?
• To what Extent does Structure Matter?
• How can Supervisory Cooperation be Increased?