Issues in Managing and Sequencing Financial Sector Reforms Lessons From Experiences in Five Developing Countries

International Monetary Fund

No 1992/082, IMF Working Papers from International Monetary Fund

Abstract: A review of the experience of five developing countries in reforming their financial systems illustrates the benefits and risks, and provides lessons on the factors which contribute to successful financial sector reforms. Financial sector reforms need to be supported by active monetary policy, and the adoption of new monetary control procedures early in the reform program; reforms should be sequenced consistently with the broader program of macroeconomic adjustment. The pace of liberalization of interest rates and credit should also take account of the solvency of financial and nonfinancial firms. A minimal system of prudential regulation is an essential element of successful financial sector reform.

Keywords: WP; bank deposit; private sector; state bank; capital market; private bank; foreign exchange; excess reserves; call money rate; excess demand; universal bank; discount window; time deposit; credit market; prime rate; money bank; Credit; Commercial banks; Financial sector; Bank credit (search for similar items in EconPapers)
Pages: 104
Date: 1992-10-01
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Citations: View citations in EconPapers (6)

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