The Commission of the Financial Market (CMF) is now the sole regulatory body with authority over Chile’s financial system.
The change arises from Law No. 21,130, published in the Official Gazette of Chile on January 31, 2019, which introduced several amendments to the General Banking Law and the Organic Constitutional Law of the Financial Market Commission, increasing the capital requirements for the banking industry, strengthening regulatory and preventive mechanisms, and legally and functionally integrated the Superintendent of Banks and Financial Institutions (SBIF) into the Commission of the Financial Market (CMF).
The integration of financial oversight has been gradual, and the process was completed on June 1, 2019.
The integration empowers a single regulator and oversight entity with systemic oversight of the whole financial market, excluding pension funds.
The integration objectives include:
• Satisfying the international standards put in place following the subprime mortgage and European banking crises
• Providing greater stability to Chile’s financial system by setting forth stronger safeguards against future crises and incentivizing investment
• Providing coherent and consistent regulation and control to enable coordination and exchange of information
• Consolidating the independent oversight role into a single body
• Allowing for a broad, systemic view of the financial market.
Changes in place effective June 1, 2019
• The SBIF and the Superintendent of Banks have ceased to operate and their tasks have been absorbed by the CMF and CMF Council.
• Entities audited by the SBIF (such as domestic banks, foreign bank branches, credit unions, and credit card issuers and operators) are regulated, audited and sanctioned by the CMF.
• The organization will remain in its current offices.
• The regulatory process will be more transparent and allow more public access, including the launch of a single website.