Regulatory fragmentation in bank–insurance conglomerates: a qualitative index for cross-regime supervision

Purpose The purpose of this study is to examine how differences across accounting, banking, insurance and group supervision affect the interpretation of capital strength and risk capacity in bank–insurance conglomerates. Regulatory fragmentation is treated as an interpretive and supervisory problem rather than proof of financial weakness. A structured method is developed through which observable differences can be identified from public evidence and compared across financial groups. Design/methodology/approach A qualitative documentary method is applied to laws, technical standards, supervisory guidance, consultation papers, enforcement reviews and corporate reports. A Regulatory Fragmentation Risk Index (RFRI) is developed across four pillars: measurement, capital aggregation, disclosure and supervisory coordination. Each pillar is classified through structured criteria and a common evidence hierarchy. The index is applied to 30 financial conglomerates across six regulatory environments and the results are examined through descriptive comparison and external plausibility assessment. Findings The greatest divergence is found where accounting and prudential valuations are compared, sector capital rules are combined at group level and related disclosures cannot be reconciled directly. Higher scores are also found where supervisory responsibility is divided across jurisdictions. Lower scores are found where group scope is clearer and public reporting supports more direct comparison. Measurement and capital aggregation remain the most persistent sources of divergence, while disclosure and coordination concerns become stronger where reconciliation and responsibility are less clear. Research limitations/implications The study is limited to public documentary evidence and qualitative classification. Market outcomes, capital shortfalls, resolution events and supervisory actions are not tested. No causal or predictive relation is established between RFRI scores and financial distress. The findings should therefore be interpreted as evidence of comparative regulatory divergence rather than firm weakness. Future research may examine whether higher scores are associated with supervisory responses, market reactions or financial outcomes. Practical implications The RFRI can be used by supervisors, group risk functions, audit committees and users of public reports to identify where further interpretation is required. Review can be directed towards measurement differences, capital transferability, disclosure reconciliation and supervisory responsibility. The pillar structure can also support clearer allocation of review duties across finance, actuarial, treasury, reporting and regulatory functions. The index is intended to guide documentary review rather than replace confidential supervisory assessment. Social implications The clearer interpretation of group capital and risk information can support confidence in the supervision of financial conglomerates. Improved reconciliation across banking, insurance and accounting reports may help reduce misunderstanding among regulators, investors and other users of public information. Better identification of reporting and coordination gaps may also support more informed oversight of institutions that operate across sectors and jurisdictions. The index therefore contributes to clearer public understanding of how complex financial groups are assessed. Originality/value A recognised policy concern is converted into a structured qualitative index based on public evidence. The study brings accounting, prudential capital, disclosure and supervisory coordination into one comparative framework. Each pillar classification is linked to legal, supervisory or corporate sources and the method is applied across 30 groups in six regulatory environments. The value of the study lies in providing a repeatable supervisory reading method without presenting regulatory divergence as proof of insolvency, distress or failure.