FSB urged to accerelate & radicalise reforms
Tuesday 10 January 2012 - by Andrew.Hickley@gfsnews.com
In a letter to the FSB released on Tuesday, the Trade Union Advisory Committee to the OECD says it is concerned about the delayed implementation of a number of initiatives agreed by the G20 following the financial crisis.
It also argues that despite the FSB proposing a capital surcharge over and above Basel III minimums and greater supervisory intensity, it should agree on measures to effectively "downsize" large financial conglomerates.
To achieve this reduction, the FSB should mandate the separation of commercial and investment banking activities and could also introduce a new taxation related to the riskiness of banks' balance sheets, as mooted by the IMF.
"In its first plenary meeting of 2012, the Financial Stability Board must take decisive action to bring back on track its action plan for financial reforms," the group says.
"It must furthermore raise its ambition beyond financial stability alone, and ensure financial markets are designed and regulated to serve the real economy and contribute to inclusive growth."
The TUAC, which plays a consultative role between the OECD and national trade unions, also admits its disappointment that work to implement either a financial transaction tax or a similar IMF-proposed financial stability contribution, has not been addressed in the FSB's work programme.
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