While the benefits of greater transparency in supervision are broadly recognized, the level of disclosure remains a challenging issue. This relates to the specifics of the supervision as it obtains sensitive information with respect to the state of individual banks that if publicly disclosed may affect its competitive position. Given this, what one could expect is for supervisors to continue to increase transparency when it comes to the authority itself disclosing more information on the supervisory model and the methodology used to evaluate the risk profile of individual banks, while retaining their “secrecy” when it comes to sensitive information concerning individual banks. This should enable markets to better understand the supervisory actions, enhance accountability of the supervisors in front of the general public while protecting market-sensitive information. Tackling the issue of board effectiveness, there is a growing consensus nowadays that welldesigned committee makes important prerequisite for qualitative decision-making in central banks. The role of the committee for sound policy making is probably best noted by Warsh (2015) in his observation that “monetary policy is made neither by rule nor by discretion. It is made by committee”. The literature shows that the institutional setup of the board indeed matters for monetary policy (Morgan, 2005; Maier, 2010; Sibert, 2006) suggesting guidelines for optimal committee design. Thus, according to Maier (2010) the optimal committee should have clear objective and independence; should not be too large in size (up to five members) and have measures to avoid free-riding and discourage polarization and group think.

They also report higher transparency of banking supervision (based on adherence to the IMF code) in industrial countries than in emerging economies. Another, more recent research (Liendrop at al., 2011) suggests that the overall level of transparency of supervisors in industrial countries is very similar to transparency of supervisors in emerging economies indicating to positive movements in emerging markets in the area in recent years. Indeed, supervisors seem to endorse transparency. In 2006 the Basel Committee on Banking Supervision, in the Basel Core Principles for effective banking supervision, first mentioned that supervisors should follow transparent processes. This means that supervisors should disclose their objectives and  2  BIS central bankers’ speeches  framework and be held accountable for performing their duties in line with those objectives and framework. The Capital Requirements Directive IV (CRD IV) stipulates that supervisors need to publish relevant information on the laws, regulations, administrative rules and guidance, information on options and discretions, the general criteria and methodologies used in the supervisory review and evaluation process, and aggregate statistical data on the implementation of the prudential framework, including the number and nature of supervisory measures taken and administrative penalties imposed.The European Banking Authority (EBA) acknowledges the need for supervisory transparency and has set up guidelines for supervisory transparency (CEBS, 2010) intended to increase the transparency of supervisory practices and to enhance the comparability of national practices. Furthermore, EBA publishes relevant information of all EU countries on supervisory laws and regulations and statistical data on national banking sectors, risk indicators and supervisory actions.