BR TA Financial Sector

closed

The Financial Sector Technical Assistance Loan Project will support the development of institutional capacity, to assist in the implementation of Brazil's program of financial sector reforms. The two main components will: 1) provide support in addressing systemic financial sector issues, by reinforcing banking supervision, through the Central Bank. Included is the support for the payments system reform, through policy advice on risk control management, operational upgrading, and development of an efficient government securities market. Banking supervision will be strengthened, through a combination of studies, information technology upgrade, policy formulation, and training assistance. In addition, improvements in the banking system safety net will be supported, through a revision of bank failure resolution rules, initiation of contingency planning, and improved monitoring of bank interventions; and, 2) strengthen regulation, and compliance, and, increase transparency and investor protection in the area of securities markets, by supporting the Brazilian Securities Commission - CVM. Specifically, diagnostic work will propose options on the role, responsibilities, and resources of the CVM. Included is the revision of the regulatory framework in terms of governance, accounting techniques expected under the revised Corporate and Securities Laws, improved market surveillance, and strengthened disclosure, and investor protection. Technical assistance, training, and information technology will support capacity building of both the Central Bank, and CVM.