ContextSpeech at the 2023 High-Level Meeting on banking supervision for the Americas; the BIS serves central banks worldwide and draws lessons from the March 2023 bank failures.
Why it mattersCarstens argues that resolution cannot replace strong supervision.
Problems raised
Recent bank failures in the US and Switzerland raised questions.
Bail-in and cross-border resolution are hard in practice.
Liquidity provision in resolution is inadequate.
Solutions proposed
Strengthen loss-absorption capacity.
Improve resolution planning and cross-border cooperation.
Keep strong supervision, which resolution cannot replace.
