Such disclosure would help to avoid sudden and sharp reversals in the investment positions of investors once they become aware of the true status of a country’s and a banking system’s financial health. More timely and more comprehensive disclosure of financial data also would help sensitize the principal economic policymakers of a country to the potential emerging threats to its financial stability.
This is revealed, not least, by the history of banking regulation, which I would like to go into briefly before turning to the prevailing deficiencies of banking regulation and the main challenges in strengthening financial stability.