More specific and particular issues are written in this post, while the previous post deals with broader and macro issues related to overall financial stability, worldwide. Let us begin with the ‘Accounting’ issue.
The accounting standard was agreed on convergence by two entities, the International Accounting Standards Board, and the US Financial Accounting Standards Board. The convergence deals with two issues, namely, loan loss provisioning and insurance contracts. For the final setting out, the FSB asked two boards to achieve a high-quality standard convergence.
2. Shadow Banking
To strengthen oversight and regulation of shadow banking, the FSB will publish public responses. With regard to shadow banking, the members are planning to develop policy recommendations by this September when the St Petersburg G20 Summit is to be held.
3. Long-Term Investment Financing
After going throwing review on financial regulatory factors influencing the availability of long-term investment finance, the FSB members advised more discussion to be held at the G20 Finance Ministers and Central Bank Governors meeting in February. At the meeting, more detailed measures are expected to come up.
4. LIBOR and Other Financial Benchmarks
The FSB members will have made it sure that information and knowledge are shared among authorities, reviewing ongoing initiatives to reform financial benchmark setting processes with a pursuit of good practices widespread at home and abroad.
5. Legal Entity Identifier (LEI)
On 24th of January, the global LEI Regulatory Oversight Committee (ROC) was established, which was welcomed by the FSB members. The members regard that ROC is the self-standing governance body with responsibility for the co-ordination and leadership of the FSB initiative. A strong support for LEI is expected.
6. Regional Consultative Groups
Regional consultative groups will be seeking further supervisory cooperation between home and host country, addressing previous challenges. Active information sharing is to be enhanced for this ends.
This is the end for FSB meeting result in Zurich. If you have read our blog posts about ‘FSB meeting in Tokyo’, this meeting in Zurich would make more sense. It will let you know that a meeting is not one-off discussion, but rather a continuous measure for the ultimate ends of seeking international financial stability. Meeting, a series of discussions over the financial stability issue, continues, with efforts and cooperation by the FSB members. And, as you may expect, FSB’s blog will keep you updated, as soon as the next FSB meeting is held. Can you guess what is going to be dealt with at the next meeting?