RISK DISCLOSURE PRACTICES: FINANCIAL STABILITY BOARD

July 21, 2010 at 1:41 pm | Posted in Economics, Eurozone, Financial, Globalization, Research | Leave a comment

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Financial Stability Board invites feedback on risk

disclosure practices

The Financial Stability Board (FSB)

Press, Service (press@bis.org)

Publications, Service (Publications@bis.org)

Wed 7/21/10

The Financial Stability Board (FSB) has launched a peer review of the implementation of the recommendations concerning risk disclosures by market participants that were made in the April 2008 Financial Stability Forum Report on Enhancing Market and Institutional Resilience. As part of this review, the FSB invites public input on the implementation of the recommendations.

The financial crisis highlighted the importance to market confidence of reliable valuations and disclosures of the risks that are most relevant to market conditions at the time. The recommendations in the April 2008 report related in large part to disclosures about structured products and certain other risk exposures that were of concern to market participants in 2008. The review will focus on implementation of the recommendations by FSB member jurisdictions and by the major financial institutions located in those jurisdictions.

A template (attached) to collect information from national authorities was distributed to FSB members in June 2010, and the responses will be analysed and discussed by the FSB later this year. The review is to be completed by January 2011 and the report will be published.

As part of this review, we welcome feedback from investors, audit firms, financial institutions, industry associations and other stakeholders on their practical experiences as users of the resulting disclosures or in implementing the risk disclosure recommendations. This could include comments on how disclosure practices at financial institutions have changed, areas where implementation has proven to be challenging, or initiatives that have been taken to improve disclosures. Suggestions are also welcome for possible future approaches to enhance the dialogue amongst investors, financial institutions, audit firms, standard setters and regulators about improved principles for disclosure and further improvements in risk disclosure practices.

Feedback should be submitted by 10 September 2010 to fsb@bis.org under the subject heading “FSB Thematic Peer Review on Risk Disclosure.” Individual submissions will not be made public.

The review on risk disclosures is the second FSB thematic peer review in 2010, following the completion in March of the review on compensation. Additional information about FSB peer reviews is available on the FSB website.

Notes to editors

The FSB has been established to coordinate at the international level the work of national financial authorities and international standard setting bodies and to develop and promote the implementation of effective regulatory, supervisory and other financial sector policies. It brings together national authorities responsible for financial stability in significant international financial centres, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts.

The FSB is chaired by Mario Draghi, Governor of the Bank of Italy. Its Secretariat is located in Basel, Switzerland, and hosted by the Bank for International Settlements.

For further information on the FSB, visit the FSB website, www.financialstabilityboard.org.

Financial Stability Board invites feedback on risk disclosure practices

Press, Service (press@bis.org)

Publications, Service (Publications@bis.org)

www.financialstabilityboard.org.

Wed 7/21/10

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