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 regulation 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
LEIs offer major cost savings, says OFR
17 November 2017 | Washington DC | Reporter: Drew Nicol
The OFR noted that early academic studies found that cost savings associated with adoption of the LEI approached $1 billion annually
MTS and UnaVista to collaborate for SFTR
13 November 2017 | London | Reporter: Jenna Lomax
The collaboration means that firms trading on MTS’s new global collateral management segment will be able to use UnaVista’s trade repository to trade under SFTR
LSE teams up with APIR Systems to brings LEIs to Australasia
08 November 2017 | London | Reporter: Drew Nicol
Industry estimates suggest more than 250,000 entities are still without the required LEIs
MiFID II creates “much uncertainty” for EEA members
06 November 2017 | Oslo | Reporter: Jenna Lomax
For EEA members, “much uncertainty” remains regarding ESMA's assessment of the EEA legal basis for MiFID II, according to Norway’s Finanstilsynet
SimCorp: MiFID II remains a concern for buy-side firms
01 November 2017 | London | Reporter: Becky Butcher
Some 28 percent of buy-side representatives are still unsure if and how their firm will be affected by MiFID II, just 90 days before the implementation deadline, according to a SimCorp survey
SEC grants relief to US brokers on MiFID II
27 October 2017 | New York | Reporter: Theo Andrew
The division of investment management issued three no-action letters, providing 30 months relief, allowing US broker-dealers to receive payments in hard dollars
Solvassure creates first-of-its-kind integrated reg platform
25 October 2017 | London | Reporter: Theo Andrew
The compliance platform addresses demands under the General Data Protection Regulation and the Accountability Regime, to help firms meet next year's regulatory deadlines
More regulation news