Rationale for consolidated supervision Worldwide, the process of change has allowed many financial organizations, which used to engage in the primary business of banking, asset management or insurance activities on a standalone basis, to adopt more flexible structures whereby banks opened up a wide range of subsidiaries and affiliates that primarily engage in businesses other than their core business.
The main economic and financial benefit which encourages the formation of such groups is the enhanced ability to achieve economies of scale and to capture synergies across complementary financial services business lines. These synergies result in improved operational efficiency and effectiveness due to lower costs, reduced prices, and improved innovation in products and services.