FSB published a peer review examining the macro-prudential policy framework and the framework for crisis management and resolution in Argentina. The review focused on the steps taken by the Argentine authorities to implement reforms in these areas, including by following up on relevant IMF-World Bank Financial Sector Assessment Program (FSAP) recommendations and FSB initiatives. Despite the progress made, the report includes recommendations to the Argentine authorities to address the identified issues and future challenges, as macroeconomic stability is restored and the financial system develops further.
The peer review finds that some progress has been made in recent years toward macro-prudential policy and crisis management frameworks. The Central Bank of the Republic of Argentina (BCRA) established, in 2016, a department within the Regulation Division for macro-prudential monitoring. Data used in risk analysis have been improved and efforts are ongoing to enhance the granularity of corporate sector data as well as to improve systemic risk analysis and enhance stress testing models. Commendable improvements recently in the quality of macroeconomic data have provided a solid platform for this analysis. The authorities have a broad range of banking sector tools at their disposal for macro-prudential purposes, including certain innovative tools introduced in response to the lessons from previous crises (for example, restrictions on banks’ lending in foreign currency). The authorities have also submitted to Congress a new Capital Markets Law that provides an explicit financial stability mandate to the National Securities Commission and a more robust framework for financial market infrastructures.
Some, albeit limited, progress has been made in developing the crisis management and resolution framework to address the FSAP recommendations and incorporate elements of the FSB Key Attributes of Effective Resolution Regimes for Financial Institutions. Recovery planning is underway for most domestic systemically important banks (D-SIBs) and the resolution regime benefits from a well-funded deposit insurance fund. The draft Capital Markets Law includes a proposal to introduce powers to temporarily stay early termination rights.
Keywords: Americas, Argentina, Banking, Securities, Peer Review, Macro-Prudential Policy, Resolution Framework, FSAP, FSB