In its April 2008 Report on Enhancing Market and Institutional Resilience (“the FSF Report”), the Financial Stability Forum (FSF) and its member bodies issued a comprehensive set of recommendations reflecting a consensus, both internationally and cross-sectorally, on the actions needed to address the fundamental weaknesses that have been at the root of the present turmoil […]
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This note aims to provide an overall framework that could help evaluate policy options to address the procyclicality of the financial system. While the framework is general in nature, the note focuses exclusively on options for prudential and financial reporting arrangements and the associated risk management and incentives issues. It therefore excludes other possible policy […]
2 April 2009
This note sets out recommendations to address the potential procyclicality of the regulatory capital framework for internationally active banks. Some of these recommendations are focused on mitigating the cyclicality of the minimum capital requirement, while maintaining an appropriate degree of risk sensitivity. Other measures are intended to introduce countercyclical elements into the framework. The recommendations […]
2 April 2009
Consistent with statements made in the “Report of the Financial Stability Forum on Enhancing Market and Institutional Resilience” (7 April 2008) (FSF Report – April 2008), and as described more fully in a follow up to that report issued on 10 October 2008 (FSF Report – October 2008), the Financial Stability Forum (FSF) has set […]
This report explores the link between leverage and valuation in the light of the recent experience of market stress. Prior to the crisis, traditional balance sheet measures of leverage did not give an unambiguous signal of higher risk during the boom years of 2003-07. While balance sheet leverage increased at European banks and US investment […]
The recommendations cover the following areas: the bank capital framework, bank loan loss provisions, and leverage and valuation.
The objective of financial crisis management is to seek to prevent serious domestic or international financial instability that would have an adverse impact on the real
economy.
13 November 2008
Dear Ministers and Governors: The financial crisis has underscored the importance of international coordination both in responding to the crisis and in developing and implementing policies for a sounder financial system. Coordination is important as well across the international financial institutions and bodies that support the efforts of national governments, including the IMF and the […]
14 October 2008