Profit smoothing There is widespread criticism that the dynamic provisions disguises crucial information by lumping together provisioning costs for incurred and expected losses in the income statement and is therefore counter to the objective of ensuring availability of timely and reliable information on bank performance. This can, however, be overcome by adequate disclosures about the extent of both specific and dynamic provisions.
As I hope most of you know, Phase 1 of the Code was launched in May last year in New York.1 The complete Code will be released in London in a few months' time at the end of May. It is pretty easy to find.