By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE)-The Joint Forum of World securities regulator, the International Organisation of Securities Commissions (IOSCO) on Wednesday unveiled the it’s report on supervisory colleges for financial conglomerates.
IOSCO in statement made available to investAdvocate said in the report that the result of a recent self-assessment survey of Joint Forum members, presents findings on how far cross-sectoral issues, and specific questions related to financial conglomerates, are effectively addressed within supervisory colleges.
The global securities regulator said the stocktaking exercise also provides information on the implementation of the Joint Forum Principles for the Supervision of Financial Conglomerates and, in particular, Principle six (6) relating to supervisory cooperation, coordination and information-sharing.
According to IOSCO, the present report identified several gaps and issues in relation to the implementation of Principle (six) 6.
IOSCO said issues identified includes not all jurisdictions have in place a specific supervision framework for financial conglomerates or coordination agreements with other supervisors of financial conglomerates on a cross-sectoral level.
The report affirmed that gaps also exist in the coordination of on-site and off-site supervision with other domestic or international supervisors, and in arrangements or processes for taking enforcement actions with other domestic or international authorities.
Another gap is that there appears to be insufficient specific mechanisms for supervisory cooperation and coordination in periods of crisis/stress, thereby possibly hindering effective intervention in times of crisis.
According to Thomas Schmitz-Lippert, chairman of the Joint Forum and executive director, International Policy at the German Federal Financial Supervisory Authority (BaFin), supervisory colleges are key to supervisory cooperation, coordination and information-sharing on financial conglomerates.
‘’Therefore the implementation of the Joint Forum’s principles for colleges is critical and will continue to be monitored,’’ Schmitz-Lippert.
The Joint Forum Joint Forum was established in 1996 under the aegis of the Basel Committee on Banking Supervision (BCBS), IOSCO and the International Association of Insurance Supervisors (IAIS) to deal with issues common to the banking, securities and insurance sectors, including the regulation of financial conglomerates.
