National authorities are closer to the terrain realities of their financial sectors and self-assessment of regulatory frameworks based on internationally agreed methodologies should be a priority. As we have learnt, prescription of standards for the financial sector in itself cannot prevent crises. There is a need for on-going review of the standards by international bodies and greater national commitment for implementation.
National authorities should also commit to assist each other in enhancing their capacity to strengthen regulatory frameworks and the IMF has a crucial role to play in this coordination. The IMF has recently stepped up its collaboration with the expanded Financial Stability Board on developing a framework on early warnings for identifying and mitigating systemic risks and vulnerabilities.