This paper analyzes cooperation between sovereign national authorities in the supervision of a multinational bank. We take a political economy approach to banking regulation and assume that supervisors maximize the welfare of their own country. The communication between the supervisors is modeled as a ‘cheap talk’ game. We show that: (1) unless the interests of the countries are perfectly aligned, first best regulation cannot be implemented; (2) the more aligned the interests are, the higher is welfare, but the lower are profits of the bank; (3) the bank can allocate its investments strategically across countries to escape closure.