The Financial Stability Board (FSB) held its inaugural meeting in Basel on 26-27 June, the first meeting since its re-establishment as the FSB with an expanded membership and a broadened mandate. The FSC Chairman, Dong-Soo Chin and the BOK Governor, Sung-Tae Lee attended the meeting as Korea’s official representatives.

The FSB, which was re-established in April 2009 as the successor to the Financial Stability Forum (FSF), brings together national authorities responsible for financial stability in significant international financial centers, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. It is currently chaired by Mario Draghi, Governor of the Bank of Italy.

The new structures of the FSB include, in addition to the FSB Plenary, a Steering Committee and three Standing Committees – for Vulnerabilities Assessment; Supervisory and Regulatory Cooperation; and Standards Implementation.

Representing Korea, the FSC has been included in the Steering Committee among 23 other country representatives and international standard-setting bodies (SSBs). The term of service for the Committee members is two years.

The Steering Committee will be chaired by the FSB Chair and will provide operational guidance between Plenary meetings to carry forward the directions of the FSB. The Committee will also be responsible for providing guidance and monitoring of the work progress, as well as coordination between Working Groups. It will also be conducting Joint Strategic Reviews on new international standards and policies put forth by SSBs.

The Steering Committee’s composition is decided by the FSB Chair in a manner that ensures maximum effectiveness in taking forward the FSB’s work while having regard to balanced representation in terms of geographic regions and institutional functions. The Committee ensures effective information flow to the full membership.

The three Standing Committees – for Vulnerabilities Assessment; Supervisory and Regulatory Cooperation; and Standards Implementation – will be chaired by Jaime Caruana, General Manager of the BIS; Adair Turner, Chairman of Britain’s FSA; and Tiff Macklem Associate Deputy Minister of the Department of Finance of Canada respectively.

The FSB will take forward the earlier FSF works and ensure continuity of work by maintaining operation of existing Working Groups, but also allowing new members to participate. It plans to manage contingency planning for cross-border crisis management, and collaborate with the International Monetary Fund (IMF) to conduct Early Warning Exercises.

* Please refer to the attached PDF for details.