Bank regulation and supervision: from local to global to local

Lecture by Neil Esho, Secretary General of the Basel Committee on Banking Supervision, prepared for the Advanced Finance Course at ETH Zurich, Zurich, 27 May 2025.

My lecture today will review the evolution of regulation and supervision and the role of the Basel Committee. I will start with a recap of why we regulate and supervise banks, and the role of capital and liquidity. I will then explain why the Basel Committee was set up, and the role it serves in promoting global financial stability. I will then conclude by discussing some of the lessons learned from recent bank failures and stress events.

In preparing this presentation with my colleagues, we realised that to cover all these topics in detail would require a whole course, rather than one lecture. So, my plan is to touch the surface on most issues and occasionally drill a little deeper.

So, let's start with the basics.