The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
This paper presents a detailed assessment of the observance of Mexico's compliance with the Basel Core Principles. The Comision Nacional Bancaria y de Valores (CNBV) has achieved a fundamental step forward in implementing a complete Pillar I capital adequacy regime that is consistent with the Basel Committee standards. Capital ratios have remained strong and above the regulatory minimum, supported by a rigorously applied forward-looking loan provisioning regime. Important institutional issues outside the control of senior management in the CNBV threaten the sustainability of the above achievements.