Financial Stability Forum sets out policy directions for strengthening the resilience of the financial system
The FSF's Working Group on Market and Institutional Resilience has sent
an interim report to G7 Finance Ministers and Central Bank Governors. It discusses the Working Group's
views to date on adjustments and near-term challenges in the financial system;
the causes of and weaknesses revealed by market turbulence; and broad policy
directions for strengthening the resilience of key elements of the financial
system.
The proposed policy directions are in six areas:
- supervisory framework and oversight;
- underpinnings of the originate-to-distribute model;
- the uses and role of credit ratings;
- market transparency;
- supervisory and regulatory responsiveness to risks; and
- authorities' ability to respond to crises.
The
work programmes of international supervisory, regulatory and central bank
committees and national authorities to diagnose the causes of the turmoil and
to address weaknesses are playing an important role in the Group's work. The
Group will continue to consolidate these diagnoses and develop specific
recommendations for its report in April 2008.
The interim report is available on the FSF website.
A preliminary report by the Working Group, setting out its workplan, was issued in October 2007 and is also available on the FSF website.