El Salvador: Technical Note on Safety Nets and Crisis Management Arrangements

February 11, 2014

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Format: Chicago

El Salvador: Technical Note on Safety Nets and Crisis Management Arrangements, (USA: International Monetary Fund, 2014) accessed December 22, 2024

Summary

This Technical Note presents an assessment of safety nets and crisis management arrangements in El Salvador. In El Salvador, the bank safety net—emergency liquidity assistance, resolution, and deposit insurance—faces particular challenges given that it operates in the context of official dollarization. To address systemic liquidity risk in the context of official dollarization, the Banco Central de Reservas should be provided with more powers and funds to provide emergency liquidity assistance to banks. The bank resolution plan, which has not been tested, and the deposit insurance fund, which has insufficient funds, both need to be strengthened. The authorities should also consider making the necessary changes to the banking law to strengthen the resolution and depositor insurance frameworks, as well as issuing the necessary regulations and guidelines.

Subject: Asset and liability management, Bank resolution, Bank resolution framework, Banking, Deposit insurance, Financial crises, Financial regulation and supervision, Legal support in revenue administration, Liquidity, Liquidity risk, Revenue administration

Keywords: Banco Central de Reservas, Bank, Bank resolution, Bank resolution framework, Banking law, BCR representative, Board of directors, Bridge bank, CR, Deposit, Deposit insurance, Financial institution, Global, Illiquid bank, Insurance reserve, Insurer to a bank resolution process, ISCR, Legal support in revenue administration, Liquidity, Liquidity risk, Parent bank, Resolution process

Publication Details

Pages:

25
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2014/046
Stock No:

1SLVEA2014003
ISBN:

9781475588118
ISSN:

1934-7685

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