The governor of Mexico's central bank, Agustín Carstens, talks to Silvia Pavoni about the legitimacy of the processes for selecting both the head of the International Monetary Fund and the World Bank, as well as Mexico's role within Latin America.

Much of the good work that has gone on in Mexico's banking sector in recent years has its foundations in the regulations brought in in the aftermath of the 'Tequila crisis' in the mid-1990s. But as its financial intermediation levels lag those of Latin American rivals Brazil and Chile, there is still work to be done.

Many of Latin America's high-net-worth individuals are repatriating their funds and an increasing number of foreign investors are targeting the region, thanks to its rapidly expanding economy. With such demand for local product providers, domestic firms are finding themselves having to pit their specialist knowledge against the international reach of large foreign banks, making competition tough.

A new proposal in Mexico is urging foreign-owned banks to list on the country's stock exchange. But while these banks achieve high returns on equity and the global equity markets remain volatile, the Mexican regulators may have a wait on their hands before these plans come to fruition.

Mexico's banks have gone from fuelling the country's economic disasters of the mid-1990s to creating a strong financial system that has provided the economy with robust support throughout the global economic downturn.

Agustín Carstens, central bank governor of Mexico suggests that central banks must play a more pivotal role in order to prevent such a widespread and deep-rooted crisis hitting again.

The recently approved merger of Banorte and Ixe might not spur a consolidation trend within Mexico's locally owned banks but it is a positive sign of change as the market seeks out growth opportunities and increased liquidity.