ABSTRACT

Financial crisis, realized in last 20 years mainly stemming from banking sector in many countries, caused those countries to review their financial regulation and supervision system. In addition to that, continuing merging and acquisitions among financial firms stemming from the economies of scale arguments caused the traditional financial regulation and supervision's sector-based approach to turn to risk-based approach. Under these considerations, there occurred a tendency of multi-units financial regulation and supervision system into forming an integrated regulation and supervision system.

Integrated system first formed in Scandinavian countries, which realized banking sector crisis in 1980's. After South Asian financial crisis in 1997, South Korea also formed an integrated financial regulation and supervision system. Recently, Germany has decided to form an integrated system and implemented in May 2002. In Eighth Five Year Development Plan to be implemented among 2001 and 2005, Turkey has also accepted the policy that Turkey will implement integrated financial regulation and supervision system to supervise the financial system efficiently.

The aim of this work is to offer a system structure for Turkish financial regulation and supervision system, through analyzing the countries' experience on their units that regulate and/or supervise the banking system. In this framework, before offering a system structure in line with the policy placed in Eighth Five Year Development Plan, Turkish financial regulation system structure, integrated system advantages/disadvantages and country experiences on integrated system has been studied. Subsequently, a proposal for Turkish financial regulation and supervision system structure has been made.