Creating continuously open core markets requires changes to the plumbing of derivative and repo markets, along with better data and tracking of exposures. Moving from shadow banking to market-based finance The FSB is working to strengthen the oversight and regulation of shadow banking so that it is a source of competition (to promote efficiency) and diversity (to promote resilience) to the regulated sector.
It is therefore important that the closer interaction between the academic and regulator’s worlds which is one of the new features in the design of Basel II be maintained during the implementation phase. I hope that this conference will also contribute to this.