KUALA LUMPUR: Bank Negara Malaysia governor Datuk Muhammad Ibrahim has been appointed as one of the co-chairpersons of the regional Financial Stability Board (FSB) consultative group, together with Reserve Bank of Australia governor Philip Lowe.
The two-year term takes effect from July 1.
In an announcement from Bangkok today, the FSB regional consultative group (RCG) said Lowe will take the FSB chair while Muhammad will be the non-FSB member co-chair.
Membership in the RCG Asia includes financial authorities from Australia, Cambodia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Pakistan, Philippines, Singapore, Sri Lanka, Thailand and Vietnam.
The Basel-based FSB has six CGs to bring together financial authorities from FSB member and non-member countries to exchange views on vulnerabilities affecting financial systems and on initiatives to promote financial stability.
Vulnerabilities in the global financial system and their potential impact on Asia and policy responses to - US interest rate normalisation, global political developments and capital flows in Asia, were discussed.
Regulatory approaches to cybersecurity and information sharing were among the concerns raised on financial stability risks which policymakers, regulators and supervisors must consider.
“A few of the issues discussed include interactions between authorities and private-sector parties, cross-border legal issues and regulatory arrangements, further developing open lines of communication across relevant authorities within and across jurisdictions, and building of staff capacity.”
In the FSB’s workplan for 2017 and its deliverables for the G20 Leaders’ Summit in July, the members focused on the agreed reforms, creating a structured framework for the evaluation of the effects of reforms, and addressing new and emerging vulnerabilities.
The use of governance frameworks to address misconduct risk in the financial sector by way of a supervisory toolkit or guidelines,is also being considered.
Over the past several years however, a series of high profile misconduct cases in major financial institutions has come to light – some of which may create systemic risks and undermine public confidence in financial institutions and markets.