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Banking Supervision and Systematic Bank Restructuring: An International and Comparative Perspective

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The spillovers from the crises in emerging financial systems, and their potential to disrupt the financial systems of other economies were widely recognized in the wake of the financial crises in East Asia. In his book, Dr. Mwenda observes that a study conducted by the International Monetary Fund in 1999 found that weak financial institutions, inadequate bank regulation and supervision, and lack of transparency lie at the heart of economic crises in these economies. These experiences have underscored not only the importance of a sound banking sector for micro-economic stability, but also the influence of macroeconomic and structural policies, as well as strong governance and the soundness of any banking system. In a nutshell, these observations are what makes Dr. Mwenda's latest book on Banking Supervision and Systemic Bank Restructuring a must read. Dr. Mwenda states (and I agree with him) that in this book he departs from regurgitating what is already known to introduce a richer novel contribution. This contribution is the suggestion throughout the book of an integrated and interdisciplinary model of effective banking supervision and systemic bank restructuring. Such a model, according to Dr. Mwenda, would utilize and encompass supervisory tools from disciplines such as securities regulation, insurance law and economics since as he argues, in practice, most of these disciplines intertwine. In this book, Dr. Mwenda has attempted to kill two birds with one stone: on the one hand, he has attempted a broad analysis of the issues in systemic bank restructuring, from an international and comparative perspective, and an examination of the possible ways forward. Equally significant, on the other hand, is the specific analysis and study of the state of banking supervision and systemic bank restructuring in less developed economies such as Zambia. Although he handles the issues with the skill and high-level assessment characteristic and reminiscent of a scholar of his knowledge and expertise, this is no easy feat. Throughout the book it is evident that there is a balancing act in the development and analysis of themes. As a result, breadth is at times sacrificed for depth - that is, there is a bit more depth on Zambia - while the international and comparative assessment of the integrated supervision model is dealt with broadly without exhausting the issues to finite detail. All in all, the book is very well written and is an excellent contribution to the field of knowledge concerned. The book breathes new life into the spheres of banking supervision and systemic bank restructuring, addressing a number of cardinal and contemporary issues in the field. I have had the opportunity of reading several books by this author and have always been struck by the bold and novel ideas Dr. Mwenda puts on the table as well as by the well-marshaled arguments around which critical analyses are sustained. In a characteristic way, Dr. Mwenda identifies a problem in an area of law and offers an invaluable contribution analyzed against the background of existing literature.