Identifying and evaluating the challenges of the central bank's comprehensive supervision using multi-criteria decision-making methods

Abstract

Identifying and assessing the challenges of comprehensive central bank supervision refers to the processes in which the central bank of the country tries to identify the problems and weaknesses that exist in the supervisory and financial system and assess the impact of these challenges on the performance and stability of the banking and financial system. In general, identifying and assessing supervisory challenges is of great importance for the central bank, because it helps maintain financial stability and prevent crises, and ultimately will lead to protecting the interests of depositors and increasing the credibility of the country's financial system. The aim of the present study is to identify and assess the challenges of comprehensive central bank supervision. In this study, 10 experts in the fields of banking and economics identified 15 key challenges and then responded to a questionnaire designed in this regard. The results of the analyses conducted using the DEMET method showed that among the identified challenges, the lack of transparency in the performance of the central bank and legal restrictions for more detailed supervision were recognized as the most influential challenges. These challenges play a key role in the quality of supervision and efficiency of the central bank, and addressing them can help improve the performance and credibility of the country's banking system. The results of this research can guide policymakers in designing appropriate strategies to strengthen supervision in the financial system.