Norges Bank is pleased to invite you to a conference on "Banking Crisis Resolution - Theory and Policy". The conference will be held in Oslo beginning Thursday morning, June 16, 2005 and ending Friday afternoon, June 17.
The conference will deal with both theoretical and practical issues related to banking crisis resolution. We hope to draw on the accumulated experience of recent crises and give practitioners in key policy institutions some best practice advice on banking crisis resolution, including the role of central banks in crisis resolution.
Session 1 and 2 will form the backdrop for the rest of the seminar. Drawing on the recent publication The Norwegian Banking Crisis, Norges Bank will first give a broad overview of key features of this crisis. We will then get a Bank of Japan perspective on the Japanese crisis, followed by cross-country experiences on banking crisis resolution by the World Bank and the IMF.
Session 3 will look at the role of central banks in banking crisis resolution. Jean-Charles Rochet will start off the session with a presentation on the LLR policy of central banks. Following him, this session will explore three sub-topics: (i) the central bank's need for information on individual banks' financial strength, (ii) the role of central bank collateral policies, and (iii) the division of labour between the central bank and the Treasury and whether an independent LLR role of the central bank is conceivable without taxpayer's money involved.
The next day will start with a lecture by Franklin Allen on Banking crisis resolution - lessons learnt. Session 5 will follow with the sub-topic of blanket guarantees. There are still divergent views about their desirability, and even about what they are. The IMF has on occasions been advocating such guarantees as a necessary resolution tool, and they will lay out their arguments first. Then, Edward Kane will point out the potential pitfalls of blanket guarantees and present the arguments for not using them in a crisis.
Session 6 will follow with an overview of the Norwegian experience with Government ownership of banks, and then a presentation of key features of the FDIC bridge bank resolution method.
The last session 7 will concentrate on the challenges for crisis resolution posed by large banks in small countries. There has recently been considerable attention to the general issue of resolving large bank insolvencies, but less attention to the specific challenges posed by the ongoing consolidation process for central banks and supervisory agencies in small countries. The session will include a central banker's perspective from Belgium, followed by presentations inspired by the experiences of Finland and New Zealand.
We hope you will find the program exciting and look forward to seeing you at this event in Oslo.