Publication: Slovenia : Pilot Diagnostic Review of Governance of the Banking Sector
Date
2008-02
ISSN
Published
2008-02
Author(s)
World Bank
Abstract
The financial crises of the late 1990s
in East Asia and Eastern Europe, as well as the recent
corporate governance scandals in Europe and America, have
highlighted the need for strong corporate governance in
ensuring a sound and stable financial sector. The governance
practices of banks are important because banks accept
deposits from the public, whose funds the government has an
implicit (and often an explicit) obligation to protect.
Banks are also subject to information asymmetries and high
leverage, both of which make banks vulnerable to a sudden
run on deposits where public confidence fails. The Slovenian
bank governance review has three objectives to: 1) conduct a
review of the Slovenian bank governance framework, 2) make
recommendations on provisions that would help to strengthen
the governance structure of banks in Slovenia, and 3) refine
the good practices developed for the pilot banking
governance review program. In addition, the international
community has encouraged the strengthening of governance in
the banking sector. The Slovenian banking sector has
successfully weathered the financial crisis seen in other
countries in 1997-1998, and has improved its stability.
However some shortcomings in bank governance remain. The
government remains the dominant owner of banks in Slovenia.
Citation
“World Bank. 2008. Slovenia : Pilot Diagnostic Review of Governance of the Banking Sector. © Washington, DC. http://openknowledge.worldbank.org/entities/publication/e3ecc434-9cab-5d70-a0a6-3607f803cf7e License: CC BY 3.0 IGO.”