Regarding borrower quality, it is imperative that banks ensure that mortgage holders are credit worthy and capable of withstanding income shocks. The propensity for banks to take risks can increase in a competitive market where they are trying to maintain/increase market share.
The lessons from these cases for developing country supervision are that basic control functions are critical to all organizations, no matter what the size, and that banks operating overseas must be monitored carefully and continuously. Related to these cases is the broader issue of implementing a rigorous supervisory structure for foreign banking organizations.