Three years after the onset of the global financial crisis, much has been done to reform the global financial system, but there is much left to accomplish, the International Monetary Fund (IMF) said on Sunday.
"The regulatory reform agenda agreed by G20 leaders in 2009 has elevated the discussions to the highest policy level and kept international attention focused on establishing a globally consistent set of rules," the IMF said in a Staff Position Note, prior to its upcoming annual meeting.
Comprehensive reform, once agreed and implemented in full, will have far-reaching implications for the global financial system and the global economy. Prompt progress by the international community in several key sectors is crucial to reduce the likelihood and impact of another crisis and to alleviate regulatory uncertainty, said the Washington-based agency.
"Global coordination is needed to reap the benefits of global finance, foster competition, and minimize the scope for cross- sector and cross-border regulatory arbitrage, which could be damaging to global financial stability," reads the paper entitled "Shaping the New Financial System."
Supervision needs to be more intensive and intrusive, as well as more focused on cross-border exposures. Success in achieving financial stability will depend critically on complementing micro- prudential regulations, which aim to improve the resilience of individual institutions, with effective macro-prudential regulations that strengthen the resilience of the financial system as a whole, according to the paper.
The IMF and the World Bank Group are scheduled to hold their annual meetings in early October in Washington.
Xinhua/ Editor: yan
