Today, the Central Bank of Jordan hosted the sixth meeting of the FSB Regional Consultative Group for the Middle East and North Africa (RCG-MENA) in Dead Sea, Jordan.
At the meeting, the members of the RCG-MENA were updated on the FSB’s work plan and the progress made in the four core areas of financial regulatory reforms: building resilient financial institutions, “ending too-big-to-fail”, transforming shadow banking, and making derivatives markets safer. In regard to the “ending too-big-to-fail”, members discussed recovery and resolution of financial market infrastructures with particular reference to implementation challenges for the MENA region. The discussion also focused, from the MENA region perspective, on the issues in cross-border cooperation and information sharing for resolution purposes.
Members discussed salient global macro-economic and macro-financial developments and their potential financial stability implications for the MENA region in the context of vulnerabilities in the global financial system and regional financial stability. Members also exchanged views on and shared experiences in reducing mechanistic reliance on the ratings of the credit rating agencies, and the plans for reducing such reliance. The role of supervisory capacity building for enhancing risk governance practices in financial institutions in the region was yet another theme of discussion. Members also deliberated on the impact of regulatory reforms on the long-term investments, with a focus on encouraging non-bank, market-based alternative financing mechanisms for promoting long-term investments.
The RCG-MENA is co-chaired by Erdem Başçı, Governor, Central Bank of the Republic of Turkey and Riad Salame, Governor, Central Bank of Lebanon. The current membership of the RCG-MENA includes financial and regulatory authorities from Algeria, Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Tunisia, Turkey and the United Arab Emirates. The list of members of the RCG-MENA is accessible at: http://www.financialstabilityboard.org/about/rcgmena.pdf.