worse still, if there are supervisory gaps, the chance of any one authority identifying potential adverse impact from areas outside of one ’ s own mandate is even smaller. take the us as an example, the authorities and investors did not realize that credit rating agencies were not doing an adequate job in their rating of complex structured products. if there were a lead supervisor, would the whistle have been blown earlier? i believe that there would have been a better chance if there were a lead supervisor with a clear mandate to take the lead responsibility and who is risk focused. there would have been more dialogues through which weaknesses may have been identified and corrected. the idea of a lead supervisor has gained widespread support in the area of cross - border supervision, as it contributes to better coordination, which in turn could help to prevent or identify problems at an early stage. by the same token, such benefits could be gained in the domestic setting from having a lead supervisor under the separate authorities model. of course, in the case of the integrated model, the notion becomes a lead department in the same agency, rather than an outside lead supervisor. the next question is : who should be the lead supervisor? the obvious answer is it should be the one that supervises the core financial institutions of the country. and following my previous argument that a central bank should supervise the core financial sector, the central bank should be the lead supervisor. the financial landscape, role, and systemic importance of financial institutions evolve overtime, so must the scope of oversight and focus of lead supervisor. the lead supervisor must closely monitor this evolution and ensure no regulatory gap emerges. it can do so by expanding its scope of supervision either directly or indirectly through the relevant agencies and build coordination to ensure it can perform its lead role properly.

tanya sirivedhin : new challenges for finance and capital markets speech by ms tanya sirivedhin, deputy governor of the bank of thailand, at the conference on “ thailand - finance and capital markets ”, held in bangkok, on 28 september 2000. * * * today ’ s conference is very timely, in view of the increasing role that finance and capital markets are likely to play in the future thai financial scene. i have identified several aspects of the challenges of “ finance and capital markets ” which i would like to share with this audience. i hope that the open discussion of these challenges will be an important input into the work of the thai authorities, and what we envisage to be the vision for our industry. i shall frame the challenges in three dimensions : first, the challenges from rebuilding and strengthening the business and financial industry. second, the challenges from the adoption of best international practices. third, the challenges from the race to catch up with the new technological frontier of e - commerce and electronic trading. rebuilding and strengthening the financial industry the 1997 economic and financial crisis brought to light many weaknesses in thailand ’ s macroeconomic and financial management. in its aftermath, measures were undertaken speedily to shore up the currency and to restore confidence in the viability and sustainability of firms and businesses, both in the financial and non - financial industry. through the implementation of these measures, there were inevitably many casualties. for example, as many as 56 finance companies were closed down permanently while others, as well as the weak banks, were taken over by the authorities or consolidated. businesses caught short by the depreciation of the currency or the austere belt tightening environment which lifted interest rates to historically high levels, had to be closed down or consolidated. it became of utmost urgency to improve confidence, strengthen the operations of financial institutions and enable them to improve and resume their intermediation role. in the view of the bank of thailand, the only way to bring about sustained recovery of the economy which was affected by the liquidity crunch situation, and by the concern over counterparty credit risks in the midst of the crisis, was to tackle head - on the issue of non - performing loans. in june 1998, the bank of thailand, in cooperation with five associations, namely, thai bankers ’ association, foreign banks ’ association, association of finance companies, board of trade, and federation of thai industries, set up the corporate debt restructuring advisory committee ( cdrac ). this was aimed to oversee and