In either case, the supervisory authority and central bank - whether home or host - must ensure that they have the capacity to maintain a robust financial system and to respond quickly and effectively to any financial crisis - often within hours.
This is a challenge for any supervisor, but it is all the more complicated when it is a foreign-owned bank that gets into difficulty, given different jurisdictions, potentially different statutory objectives between home and host authorities, and a greater degree of jurisdictional separation between taxpayers and depositors than is the case with domestically-owned banks.