I would like to conclude my remarks with a discussion of a basic supervisory issue related to foreign banking organizations that continues to challenge supervisory agencies around the world. Evolution of the U.S.
Supervisory System In the not-too-distant past, the Federal Reserve and other supervisory agencies in the United States relied considerably on validating financial accounts and records during on-site examinations to assess the safety and soundness of banking organizations. Examiners also spent significant time valuing account balances by performing detailed reviews of individual loans and other risk assets.