Financial Market: Sector Strategy (2000)

This Financial Market Development Strategy (GN-1948-3) has been prepared to assist IDB staff in the process of supporting financial market development, as financial markets provide the appropriate environment for capital mobilization to profitable investment opportunities. The IDB must strive for balance with a continued concentration on the establishment of efficient and effective, safe and sound banking systems, while pursuing opportunities to motivate nonbank financial markets, institutions and instruments where appropriate. It will need to address the issues underlying the development of complete markets. The Strategy proposes methods in which the IDB can encourage the development of the market based institutions to support the financial needs of individuals and firms as well as support innovation in the financial markets and institutions of the region. The underlying goal is an increased role for the private sector in the development of financial markets. The main emphasis of the IDB's strategy is related to the development and/or strengthening of a variety of intermediaries that operate in financial markets, including but not limited to depository institutions, insurers, pension funds, mutual funds, leasing companies, investment banks and guarantee funds. Much of the focus of the strategy will be on the development of the legal and regulatory environment needed to support efficiently functioning financial markets and institutions.