Hamburg
06 July 2017
Reporter: Mark Dugdale

Fend off reform fatigue, urges FSB


The Financial Stability Board (FSB) has called on the leaders of G20 nations to fend off reform fatigue and continue to work together through reinforced, voluntary, international regulatory cooperation grounded in agreed international standards.

Bank of England governor and FSB chair Mark Carney wrote to G20 leaders on 3 July ahead of their summit in Hamburg on 7 and 8 July to update them on the FSB’s progress in areas such as OTC derivatives reform and shadow banking.

Through a series of reports delivered over the last week on multiple subjects, the FSB appears to be largely pleased with its work since the financial crisis of 2008 to minimise risks in markets, with Carney telling G20 leaders that reforms “are building a safer, simpler and fairer financial system”.

“[But] there are nascent risks that, if left unchecked, could undermine the G20’s objective for strong, sustainable and balanced growth,” Carney warned.

Without naming US President Donald Trump’s aim to repeal and replace the Dodd-Frank Act, and possibly halt implementation of key Basel III reforms such as the net stable funding ratio, nor the UK’s decision to leave the EU, Carney said: “Giving into reform fatigue could erode the willingness of G20 members to rely on each other’s systems and institutions and, in the process, fragment pools of funding and liquidity, create inefficiencies and frictions, reduce competition, and diminish cross-border capital and investment flows.”

He added: “There is, however, another path that involves working together through reinforced, voluntary, international regulatory cooperation grounded in agreed international standards.”

These include encouraging full and consistent implementation of standards to support a level playing field and reduce regulatory arbitrage opportunities, and revising legal frameworks to facilitate cooperation.

On this last point, Carney gave the example of sharing information among authorities on resolution and removing legal barriers to reporting OTC derivatives to trade repositories and to authorities access to that data.

More news
The latest news from Asset Servicing Times
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
Pension fund mandate for BNP Paribas
21 September 2017 | London | Reporter: Jenna Lomax
The West Sussex Pension Fund is the fifth appointment BNP Paribas has secured under the Local Government Pension Schemes (LGPS) National Framework Agreement
IHS Markit names new COO for thinkFolio
21 September 2017 | London | Reporter: Jenna Lomax
Cunningham will lead thinkFolio’s product management, services, support and managed service offering
AcadiaSoft expands user base for IM compliance
21 September 2017 | Massachusetts | Reporter: Drew Nicol
The second phase of the IM rules went live on 1 September under the regulatory framework of BCBS and IOSCO
SIX: Speedy settlement key in collateral management
21 September 2017 | London | Reporter: Stephanie Palmer
Real-time settlement is the most important consideration when choosing a new collateral management provider, according to research from SIX Securities Services
FCA takes pragmatic approach to MiFID II deadline
21 September 2017 | London | Reporter: Drew Nicol
The UK’s financial conduct authority has indicated it will accept a soft roll out of the second Markets in Financial Instruments Directive in January
Trade Informatics releases Peer Analysis tool
20 September 2017 | New York | Reporter: Jenna Lomax
The new addition will provide asset managers with tools to analyse how they compete with other money managers
BNP Paribas becomes first French OTC Clearing member
20 September 2017 | Hong Kong | Reporter: Barney Dixon
BNP Paribas has joined OTC Clearing Hong Kong, as the clearinghouse’s 17th member, and the first from France
More news