Financial Stability Board
The Financial Stability Board (FSB) is an international body that monitors and makes recommendations about the global financial system. Here's a detailed overview:
History
- The FSB was established in April 2009 as the successor to the Financial Stability Forum (FSF), which was founded in 1999 following the Asian financial crisis to promote international financial stability.
- The decision to transform the FSF into the FSB came in response to the 2007-2008 global financial crisis, aiming to broaden its mandate, membership, and resources.
Mandate and Objectives
- The FSB's primary goal is to coordinate at the international level the work of national financial authorities and international standard-setting bodies in order to develop and promote the implementation of effective regulatory, supervisory, and other financial sector policies.
- It focuses on:
- Assessing vulnerabilities affecting the global financial system.
- Identifying and overseeing actions needed to address these vulnerabilities.
- Promoting the coordination and information exchange among authorities responsible for financial stability.
- Monitoring and advising on market developments and their implications for regulatory policy.
Membership
Structure
- The FSB is chaired by a representative, typically from one of the member countries, with the position rotating among members. The current chair is Klaas Knot, President of the Dutch National Bank.
- The board includes a Steering Committee, Standing Committees, and Working Groups that focus on specific areas like standards implementation, risk assessment, and financial innovation.
Key Activities
- Vulnerability Assessment: Regularly assesses the global financial system for vulnerabilities, including shadow banking, non-bank financial intermediation, and cyber risks.
- Policy Development: Develops and promotes policies to strengthen financial systems, including frameworks for resolution of financial institutions, systemic risk oversight, and macroprudential policies.
- Peer Review: Conducts peer reviews of member countries' compliance with international financial standards.
- Outreach: Engages with non-member countries to promote global financial stability and regulatory cooperation.
External Links
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