, the current crisis has brought them to the fore. the speed at which the crisis has spread across the globe indicates that the development of coherent and rigorous frameworks for maintaining financial stability came too late for several countries, leading to adhoc and inconsistent policy responses. ladies and gentlemen, over the years, we have witnessed a process of change that has allowed many financial organisations worldwide to adopt more flexible structures whereby they have established a wide range of subsidiaries and affiliates that are engaged in business lines different from the core business of the parent financial institution. we have seen banking activities, asset management or insurance activities that previously were conducted on a stand - alone basis now being provided within one financial group. this trend has steadily gained momentum in the eastern and southern african financial sector. some of these financial groups operate businesses across borders. the main economic and financial benefit which encourages the formation of such groups is the enhanced ability to achieve economies of scale and capture synergies across complementary financial services business lines. these synergies result in improved operational efficiency and effectiveness due to lower costs, reduced prices, and improved innovation in products and services. at the same time the emergence of such groups has brought complex linkages and relationships among economic agents. consequently, they have also necessitated a paradigm shift in supervisory approaches in order to identify, manage and monitor risks. it is evident in our various jurisdictions that current legislation and regulatory tools are not adequate to effectively address the potential risks that threaten the safety and soundness of our respective financial sectors posed by activities emanating from such financial groups. ladies and gentlemen, i do not want to dwell much on what should be addressed by this seminar. i am glad that mefmi and the fsi are conducting this seminar on consolidated supervision for the region at a time that our region is also exploring these topical issues. it is my hope that this seminar will equip participants with relevant skills as senior examiners to develop appropriate policies for their jurisdictions with respect to consolidated supervision as well as prepare them for the daunting challenge of actually implementing consolidated supervision in our various jurisdictions. it is also my expectation that you will leave this forum after three days, with a new mindset and a renewed commitment to practice what you will have learned so that you could contribute to improving supervisory frameworks in our various countries. i trust that the seminar will also provide you with an opportunity to network and establish durable and valuable professional contacts within the region. i wish to take this opportunity, on behalf of the mefm

caleb m fundanga : the history and experiences of the financial sector and regulatory framework in zambia address by dr caleb m fundanga, governor of the bank of zambia, at the co - operative bank capitalisation consultative forum “ the history and experiences of the financial sector and regulatory framework in zambia ”, lusaka, 3 march 2011. * * * the honourable minister of agriculture and co - operatives, hon eustarkio kazonga, m. p ; the board chairman of the co - operative bank zambia limited, mr mulilo kabesha ; members of the diplomatic corps ; distinguished invited guests ; ladies and gentlemen it is with great pleasure and privilege to speak to you at this very important consultative forum. i have been requested to speak briefly on the history and some of the experiences of the financial sector in zambia. ladies and gentlemen, as you are aware, considerable developments have been recorded in the zambia economy in general and the financial sector in particular, following the liberalization of the economy in the early 1990 ’ s. these developments include the proliferation of banks and non - bank financial institutions, which have necessitated the review of supervisory policies as well as the legal and regulatory frameworks in order re - align them to the liberalised environment. a significant development relating to the zambian financial sector was the decision to relocate the function of the registrar of banks and financial institutions to the bank of zambia from the ministry of finance and national planning where it was previously located. this decision was taken in an effort to enhance regulatory oversight of banks and financial institutions starting from the licensing stage. currently, all applicants have to be evaluated in line with relevant provisions of the banking and financial services act ( bfsa ) and international best practice such as the basel core principles on effective banking supervision. the intention is to ensure that only applicants who meet these stringent criteria enter the financial system in zambia. this is crucial for fostering confidence and stability in the financial system. mr chairman, you may be aware that in the early stages of the reforms, a number of commercial banks faced serious problems and were subsequently liquidated. the closures were in part a consequence of the reforms. the reforms also highlighted some weaknesses in corporate governance arrangements at most failed banks. however, following improvements in the regulatory and supervisory frameworks, no bank closure has been recorded since 2002 and the banking sector has recorded significant growth. the growth in the sector can also be attributed to prudent fiscal and monetary policies aimed at achieving sustainable macroeconomic stability.