The Chilean government on June 1 officially integrated the SBIF superintendency of banks and financial institutions under the CMF financial markets commission.

The CMF absorbs the former regulator as a part of the Latin American country's new banking law, which will revamp the regulatory framework for the country's financial sector and bring it in line with international Basel III standards. The law marks the biggest overhaul of bank rules in Chile in the last 30 years.

The merger sees banks, cooperatives, insurance companies, investment and mutual funds all gather under the single independent markets commission.

Among the benefits expected by the CMF from the merger are a more integrated regulatory framework, greater consistency and transparency in regulation, a broader base for the use and development of specialized knowledge and the leveraging of available resources to strengthen oversight and synergies among regulators.

This brings about three-fourths of the financial system under the same regulator, according to a report by La Tercera. "International evidence tends to show that more regulators have been integrated because they are able to handle more information about the supervised," Joaquín Cortez, head of the CMF, told the newspaper.

"Having banks and insurance companies together ... greatly increases the information you have on financial conglomerates," Joaquín Cortez said.