Newsletter January 2012: Closing gaps in financial conglomerate oversight

BASEL – In an effort to close regulatory gaps and eliminate supervisory “blind spots,” the Joint Forum has updated its principles for overseeing financial conglomerates. It wants to ensure effective supervision of risks arising from unregulated financial activities and entities. In a consultation paper issued in mid-December*, the Joint Forum says the financial crisis that erupted in 2007 exposed situations in which regulatory requirements and oversight did not fully capture all the activities of financial conglomerates or fully consider the impact and cost that these activities may pose to the financial system.