General Considerations for a Cross-border Memorandum of Understanding between Supervisory Authorities

The existence of financial groups operating in more than one jurisdiction, as well as interrelationships between financial entities established in different jurisdictions have led several financial authorities to sign memoranda of understanding (MoU). The increase in the number and scale of such groups, as well as recent changes in the resolution frameworks of financial institutions and the emergence of new risks, including cyber risks, suggest the desirability of reviewing the content of these existing cooperation agreements with a view to updating them.

In this context, the ASBA Technical Committee considered it to be appropriate to develop a series of principles and recommendations that could serve as a reference for ASBA members when updating their MoUs or signing new ones with other jurisdictions with which they have not yet done so. To this end, a specific working group was convened to identify the core elements that should be considered for inclusion in an arrangement between financial supervisory agencies, in line with the latest developments at international level and needs of ASBA members. The purpose of this document is to procure that ASBA members consider the use and/or adaptation of these guidelines in accordance with their legal frameworks and particular circumstances for the negotiation of bilateral or multilateral agreements.

The document covers the following topics: information sharing, confidentiality, and data protection; licensing and authorizations; ongoing supervision; on-site inspections; and cooperation during crisis situations. Additionally, depending on the scope and mandates, the participating authorities may evaluate including the supplemental principles and recommendations that address specific elements regarding cybersecurity, anti-money laundering and countering the financing of terrorism, and resolution planning and resolvability assessment.

Categories: Publications of ASBA
Author: ASBA