To G20 Ministers and Governors
Progress on the global regulatory reform agenda
I am pleased to attach the following reports for the meeting on 23 April:
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A report on progress in implementing the G20 regulatory reform objectives, covering international policy development and national implementation;
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A peer review assessment of implementation of the FSB compensation principles and standards;
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A joint FSB-IMF-BCBS comparative note on capital and liquidity surcharges, and systemic levies and taxes.
Also attached is a note on competitive conditions in the financial sector, requested at St Andrews.
The G20 have achieved much over the last year and a half to stabilise the financial system. Exit from exceptional support is underway, and completed in some cases. Credit conditions in the countries at the heart of the crisis have begun to normalise and loan growth has resumed. In other G20 countries, policy is appropriately directed at restraining buoyant credit growth. There are, to be sure, challenges of adjustment ahead, but on the whole the financial system is on the mend.
Good progress continues to be made on regulatory reform. International policy development is proceeding to agreed timelines. Where policies have been completed, implementation at national level is taking place across a broad front, as the attached reports show. Legislative changes necessary to implement new regulatory objectives are advancing in the major jurisdictions.
Yet, 2010 and 2011 will be critical years for the most important pieces of global reform and will largely determine whether we meet the reform objectives and timelines agreed by G20 Leaders. Continue reading