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27/12/2010

The Financial Stability Council held its second regular meeting. It was chaired by the CBM Governor, Mr. Radoje Žugić, and attended by the Council members Mr. Vladimir Kavarić, the President of the Insurance Supervision Agency, and Mr. Zoran Đikanović, the President of the Securities and Exchange Commission.

The minutes of the first constitutive meeting of the Financial Stability Council were adopted at the meeting. The Council also adopted the Decision on the collection and exchange of data and information of importance for the financial system stability and the Decision on giving consent to the list of persons responsible for the delivery of data and information to the Financial Stability Council.

The Council was introduced to the information regarding the Basel III timeline for the implementation of novelties which this international standard will bring to the banking system operations.

Basel III is a part of ongoing efforts of the Basel Committee on Banking Supervision (BCBS) to further enhance the regulatory framework with a view to improving both quantity and quality of capital in order to discourage excessive borrowing and risk-taking of the banking sector. An integral part of this capital reform represents the introduction of the new minimum liquidity standards for internationally active banks. The new rules concerning capital and liquidity, after their full implementation, should enable banks to be able to absorb any future disturbances in the global financial market without being extended any extraordinary state support, as well as to improve the risk management process. This will provide the vital contribution to a long-term financial stability.

In the end, it was concluded that some risks to the financial stability still remain, yet the overall risk level was assessed as being moderate.

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