BANGKO SENTRAL ng Pilipinas (BSP) Governor Benjamin E. Diokno will co-chair the Financial Stability Board’s Regional Consultative Group for Asia (FSB-RCGA), together with Reserve Bank of India Deputy Governor N.S. Vishwanathan, for two years term starting July 1, the BSP said in a statement on Monday.
The FSB based in Basel, Switzerland, was formed in 2009 at the height of the Global Financial Crisis in order to develop and promote effective regulatory, supervisory and other financial sector policies in order to help ensure global financial stability.
“Governor Diokno’s co-chairing of the FSB-RCGA comes at a time when various market reforms are at an important stage while evolving global developments could again challenge financial stability,” the BSP said in a statement on Monday. “The Governor’s co-chairmanship further highlights the thought leadership of the institution in the pursuit of financial stability while reinforcing the Philippines’ active participation in discussions on global reform.”
In 2011, the FSB established six regional consultative groups to provide a venue for financial authorities from FSB member and non-member countries to exchange views on vulnerabilities affecting financial systems and on initiatives for financial stability.
Other financial authorities forming part of the FSB-RCGA are from Australia, Brunei, Cambodia, China, Hong Kong, India, Indonesia, Japan, Malaysia, New Zealand, Pakistan, Singapore, South Korea, Sri Lanka, Thailand and Vietnam.
The announcement of the co-chairmanship of Mr. Diokno and Mr. Vishwanathan was made at the June 14 16th FSB-RCGA meeting in Kuala Lumpur.
There, “[m]eeting participants discussed risks from global trends, including the resumption of upward prices in risky assets, a loosening of credit standards and increases in the cost of credit,” the FSB said in a separate statement on that date, adding that members also discussed financial risks from climate change.
“At the same time, they noted that resilience in the global financial system appears to have increased, financial markets are functioning robustly and financial conditions in emerging markets have stabilized,” the statement read further.
“In spite of these positive trends, they agreed that efforts must continue to minimize the probability of another financial crisis, particularly given the increasing level of interconnectedness in the global financial system.” — R. J. N. Ignacio