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LONDON, Sept 3 (Reuters) - Financial industry regulators need better coordination in the event of a big multinational financial institution failing or breaching compliance rules, the world's top supervisory bodies have concluded in a survey.
Arrangements for handling failures of diverse financial groups are inadequate according to the survey by the Joint Forum which comprises the Basel Committee of global banking supervisors, the International Organisation of Securities Commissions (IOSCO) and the International Association of Insurance Supervisors (IAIS).
The remit of the three bodies cover the bulk of global capital markets and all main financial centres.
The crisis of 2007-2009 showed the need for closer cooperation among national supervisors who oversee different parts of global financial groups in order to take speedy action and avert taxpayer bailouts and the survey looked at whether supervisors could work together if such a financial conglomerate got into trouble.
Conglomerates combine two or more activities like asset management, banking, insurance and broking, all of which have very different supervisory requirements, making it harder to spot risks than at a single activity firm like a bank.
But the Joint Forum said that some countries still do not have specific arrangements in place to deal with such conglomerates or to coordinate supervisory agreements with other jurisdictions.
14 countries were covered by the survey -- Australia, Belgium, Canada, France, Germany, India, Italy, Japan, the Netherlands, South Africa, Korea, Spain, Britain and the United States.
"Gaps also exist in the coordination of on-site and off-site supervision with other domestic or international supervisors, and in arrangements or processes for taking enforcement actions with other domestic or international authorities," the survey report said.
"There appears to be insufficient specific mechanisms for supervisory cooperation and coordination in periods of crisis/stress, thereby possibly hindering effective intervention in times of crisis," the report added.
Joint Forum chairman and senior German regulator Thomas Schmitz-Lippert said implementation of agreed principles on coordinating supervision is critical and will continue to be monitored. (Editing by Greg Mahlich)