The Bank of England has formed an interim financial policy committee (FPC) and appointed four new external members.
In anticipation of legislation to create an FPC, the government and the bank have announced the establishment of an interim committee to "prepare the ground" for the creation of the full FPC .
The Treasury explained the full statutory FPC would be "responsible for the stability of the financial system as a whole, addressing one of the main flaws of the current regulatory framework".
The four new external members of the interim FPC, who will join the bank's governor Mervyn King and its seven previously appointed members, are: Alastair Clark, Michael Cohrs, Donald Kohn and Richard Lambert.
The government said it envisages that the full statutory FPC will "contribute to the bank’s financial stability objective by identifying, monitoring, and taking action to remove or reduce, systemic risks with a view to protecting and enhancing the resilience of the UK financial system".
While the legislation is finalised, the interim committee has been created to undertake the forthcoming statutory FPC’s 'macro-prudential' role.
The bank said an important initial task for the interim FPC will be to undertake preparatory work and analysis into potential macro-prudential tools.
Mr King said: "The interim FPC will have important work to do as part of the new proposed regulatory framework.
"Macro-prudential regulation is one of the key elements of a renewed focus on assessing and reducing risks across the financial system as a whole."
Source: http://www.ftadviser.com
In anticipation of legislation to create an FPC, the government and the bank have announced the establishment of an interim committee to "prepare the ground" for the creation of the full FPC .
The Treasury explained the full statutory FPC would be "responsible for the stability of the financial system as a whole, addressing one of the main flaws of the current regulatory framework".
The four new external members of the interim FPC, who will join the bank's governor Mervyn King and its seven previously appointed members, are: Alastair Clark, Michael Cohrs, Donald Kohn and Richard Lambert.
The government said it envisages that the full statutory FPC will "contribute to the bank’s financial stability objective by identifying, monitoring, and taking action to remove or reduce, systemic risks with a view to protecting and enhancing the resilience of the UK financial system".
While the legislation is finalised, the interim committee has been created to undertake the forthcoming statutory FPC’s 'macro-prudential' role.
The bank said an important initial task for the interim FPC will be to undertake preparatory work and analysis into potential macro-prudential tools.
Mr King said: "The interim FPC will have important work to do as part of the new proposed regulatory framework.
"Macro-prudential regulation is one of the key elements of a renewed focus on assessing and reducing risks across the financial system as a whole."
Source: http://www.ftadviser.com
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