Systemically important payment systems in Latin America and the Caribbean : results of the self-assessment exercises

Following up on the international debate, in 2002 the Working Group on Payment System Issues of Latin America and the Caribbean (WGPS-LAC) promoted among its members carrying out a self assessment exercise of the region's systematically important systems (SIPS) versus the committee on payment and resettlement systems (CPSS) core principals (CPs). The purpose of this document is to present the outcome of this effort, to which a total of 15 central banks in the Latin American region contributed. The first section describes the motivations behind this exercise and the value that is expected from its completion. In the second section the main outcomes are described and analyzed, based on the self-assessment exercises delivered by 15 central banks. Results are presented in an aggregate manner, highlighting the major strengths and weaknesses for each of the 10 CPs. Several references to the four Central Bank Responsibilities in applying the CPs are also made in this section. In the third section, the authors present an analysis that goes beyond the self-assessment exercise, in an attempt to compare the current situation of SIPS in the region with an "optimal scenario". This analysis also considers to what extent the reforms currently underway in several countries would lead to a different scenario for the region's SIPS. The fourth section compares the results of the self-assessment exercises in the Latin American region with the assessments being carried out by the IMF and the World Bank all over the world as part of their financial sector assessment program (FSAP). In this section the authors stress that obtaining "standard" or highly comparable results from this type of exercise in many different countries is still difficult, since variables such as technical capacity, openness to self criticism and resources still vary widely among countries. Finally, the last section presents a summary of findings and conclusions, highlighting the current weaknesses of SIPS in the LAC region and what are being done at present to overcome this situation.