Communiqué of the Ministers and Governors of the Group of Ten

Washington D.C., 20 October 2007

The Finance Ministers and Central Bank Governors of the countries of the Group of Ten met in Washington D.C. on 20 October 2007. Fukushiro Nukaga, Minister of Finance of Japan and current Chairman of the Group of Ten, presided. Ministers and Governors took note of the progress report on Highly Leveraged Institutions from Mr. Mario Draghi, Chairman of the Financial Stability Forum (FSF).

Ministers and Governors reviewed progress made in implementing the recommendations of the FSF's Report on Highly Leveraged Institutions updated in May 2007. They noted that hedge fund activities had not been a major source of market instability during the recent turmoil in the international financial market. They welcomed the progress made in the joint supervisory review of the counterparty risk management practices of the core intermediaries. Ministers and Governors also welcomed the progress made in the work by private sector working groups in the United States and the United Kingdom to develop hedge fund-related best practices to strengthen market discipline, and looked forward to the completion of their work. Ministers and Governors welcomed the FSF's decision to continue its ongoing work on the recommendations and to update its report on Highly Leveraged Institutions periodically.

Ministers and Governors reviewed the General Arrangements to Borrow (GAB) and endorsed the proposed renewal of the GAB without modifications for a further five-year period from 26 December 2008.

The Finance Minister of the Netherlands was elected Chairman of the Group of Ten for the coming year.