Systemic Risk Council to Convene for Regulation Monitoring

The Systemic Risk Council, a volunteer group led by former ""FDIC"":http://www.fdic.gov/ chair Sheila Bair, will meet in June to monitor and encourage regulatory reform of U.S. capital markets focused on systemic risk.

The council, formed by ""CFA Institute"":https://www.cfainstitute.org/pages/index.aspx and ""The Pew Charitable Trusts"":http://www.pewtrusts.org/, is an assembly of experts in investments, capital markets, and securities regulation.

Besides Bair, the group includes senior advisor and former ""Federal Reserve"":http://www.federalreserve.gov/ chair Paul Volcker, former SEC chair William Donaldson and commissioner Harvey Goldschmid, and a number of current and former corporate executives and U.S. senators.

The Systemic Risk Council was created in response to the slow progress of regulators and standard-setters, Bair said.

It will monitor and evaluate the activities of those who are responsible for developing and implementing Dodd-Frank provisions related to systemic risk, including the Financial Stability Oversight Council (FSOC) and the Office of Financial Research.

""The great challenge is to devise a system to identify risks that threaten market stability before

they become a danger to the general public,"" said Bair.

""As evidenced by the 2008 crisis and even recent headlines, we need a more effective and efficient early-warning system to detect issues that jeopardize the functioning of U.S. financial markets before they disrupt credit flows to the real economy,"" she added. ""And two of the most critical tasks are how to impose greater market discipline on excess risk taking and effectively end the doctrine ├â┬ó├óÔÇÜ┬¼├ï┼ôtoo-big-to-fail.'""

The council expects to evaluate and provide commentary on the current efforts of regulators to design and implement a coordinated systemic risk oversight plan. Other activities by the council will include reports and commentary to the FSOC and its members as they adopt regulations to prevent the same type of global financial disaster that occurred in 2008.

""Despite the magnitude of the financial crisis, prospects for major reform of regulatory systems are inadequate and vague,"" said John Rogers, CFA, president and CEO of CFA Institute and Systemic Risk Council member.

""This council will serve as an essential sounding board for systemic risk reforms focused on strong investor protection, and offer a critical voice to promote the enforcement of regulations, financial disclosure and transparency,"" he added.

The council will issue a call to action June 18 at The Pew Charitable Trusts in Washington, D.C. and detail its objectives and future plans.

""This new council is composed of experts with a thorough understanding of the issues, and we are pleased to support their efforts to find nonpartisan and independent recommendations,"" said Rebecca W. Rimel, president and CEO of The Pew Charitable Trusts. ""The reforms to our nation's financial system enacted by Congress and signed by the president in 2010 were an important first step. The task now is to implement these reforms, especially those related to systemic risk.""