Risk exposure and management in cross-border banking.

Abstract

The title of this paper connotes the fact that risk-based supervision and inflation targeting are mutually inclusive policies that have to be carried out simultaneously. This is not true. The two frameworks can be adopted at the same time but they do not need to go pari passu. To that extent the paper can be regarded as two-in-one. In this connection, the two frameworks are treated separately but within the context of a single paper. We looked at their challenges and prospects in monetary policy formulation and implementation in the Nigerian economy. The rest of this paper is divided into four major sub-sections. The next section deals with issues in Risk-Based Supervision framework and this is followed in Section 3 by issues in Inflation Targeting Framework. In Section 4, we look at the challenges and prospects of adopting the two frameworks in monetary policy while the summary and conclusion are contained in Section 5.