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RegulationsJuly 10

Explainer: How the Basel Committee plans to tighten outsourcing oversight

Banks are increasingly outsourcing critical functions, a trend that could pose risks to banks as well as increase financial stability concerns
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Explainer: How the Basel Committee plans to tighten outsourcing oversightImage: Gianluca Colla/Bloomberg

The Basel Committee on Banking Supervision has proposed tighter oversight of global lenders’ relationships with third-party service providers, with a view to protecting institutions in case financial or operational crises arise with their partners. 

Among the 12 principles for banks and regulators outlined yesterday by the global banking regulatory body is that a bank’s board of directors has ultimate responsibility for oversight of third-party arrangements. 

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Barbara Pianese is the Latin America editor at The Banker. She joined from Mergermarket, where she spent four years covering mergers and acquisitions across Europe with a focus on the consumer sector. She holds an MA in International and Diplomatic Affairs from the University of Bologna having studied in Brazil and France as well.
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