BIS Annual Report: Better regulation is not enough
01 July 2009
Financial instruments, markets and institutions all require reform if a truly robust system is to emerge, the report states. Financial instruments need mechanisms that rate their safety, limits their availability and provides warnings.
The BIS Annual Report argues that financial instruments, markets and institutions all require reform if a truly robust system is to emerge.
Financial instruments need mechanisms that rates their safety, limits their availability and provides warnings about their suitability and risks. Markets need to encourage trading and clearing through central counterparties and exchanges. Finally institutions need the comprehensive application of enhanced prudential standards that integrate a system-wide perspective.
“Better regulation is not enough”, the BIS states in its latest Annual Report and calls for a macro-prudential approach:
- For instruments, it means a mechanism that rates their safety, limits their availability and provides warnings about their suitability and risks.
- For markets, it means encouraging trading and clearing through central counterparties and exchanges.
- For institutions, it means the comprehensive application of enhanced prudential standards that integrate a system-wide perspective.
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© BIS - Bank for International Settlements
