This policy note focuses on provisioning practices in Latin America, a supervisory tool that if well designed can contribute to strengthen both micro and macro prudential regulation. For that purpose this note briefly explains the importance of an adequate regulatory regime for provisioning...

This policy note focuses on provisioning practices in Latin America, a supervisory tool that if well designed can contribute to strengthen both micro and macro prudential regulation. For that purpose this note briefly explains the importance of an adequate regulatory regime for provisioning...

The paper addresses two main points: the deficiencies of the past regulatory design and the additional dangers coming from financial reforms that increase the regulatory powers of supervisors. The first point is briefly dealt with reference to past experience and alternative theoretical...