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G20 Leaders Endorse Financial Stability Board Policy Framework for SIFIs

Date: 15 November 2010

Source: FSB

The G20 leaders have chosen to endorse the Financial Stability Boards (FSB’s) policy framework and timeline for “Reducing Moral Hazard of Systemically Important Financial Institutions (SIFIs)” (The link to this publication follows below). The FSB has attempted to identify the risks SIFIs have on the “wider financial system and economic activity” in turn outlining policies to address such risks. The key areas addressed for SIFIs and Global SIFIs (G-SIFIs) were: ‘loss absorbency rates, contagion risk, a capacity for swift resolve and an increased supervisory oversight.’ The FSB have yet to determine those being considered SIFIs or G-SIFIs, however the latter will have been determined by ‘mid 2011 followed by their initial assessments of said G-SIFIs by end 2012.’