The role of central bank in safeguarding financial stability
The 2008 global financial crisis, which caused a severe impact on the economy, is a crucial lesson for central banks and investors across the globe, raising awareness of the needs for financial system risk monitoring and new approaches for handling risks.
Many countries thus established a framework for monitoring financial stability that is suitable for each country context, including the setting up of various committees such as for exchanging information between financial regulators, formulating policy to ensure financial stability and ordering action in accordance with laws.
Ensuring financial stability is one of the BOT’s mandates. Thus the BOT has established the joint meeting between the Monetary Policy Committee (MPC) and the Financial Institution Policy Committee (FIPC) to jointly monitor financial stability risks. The joint committee aims to build a financial ecosystem that is stable, sustainable and inclusive.
The BOT works in close coordination with other financial regulators - the Securities and Exchange Commission (SEC), the Office of Insurance Commission (OIC) and the Cooperative Promotion Department (CPD) - to ensure the alignment in supervisory direction and better cooperation for information exchange and continuity of the joint meeting.
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