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Caribbean warned against contagion amid increased financial integration

Published:Thursday | August 1, 2013 | 1:35 PM

Caribbean countries are being warned that while increased financial integration has facilitated the flow of funds, it has also increased the likelihood of contagion.



A recent research noted that this was evident most recently when the collapse of the Trinidad-based conglomerate, CL Financial Group sent repercussions throughout the Caribbean region.



It said the collapse of the Trinidad-based CL Financial Group highlighted the critical need for financial sector reforms, including enhanced supervision on financial institutions; harmonised supervisory standards; and closer cooperation and information sharing among supervisors.



The findings were published in an International Monetary Fund Working Paper examining the “Financial Interconnectedness and Financial Sector Reforms in the Caribbean.”



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