Written question asked by Jim Cousins (Labour) on Thursday, 29 April 1999, in the House of Commons. It was due for an answer on Thursday, 6 May 1999. It was answered by Patricia Hewitt (Labour) on Thursday, 6 May 1999 on behalf of the Treasury.

Treasury

Question: To ask Mr Chancellor of the Exchequer, what steps he is taking to encourage financial institutions to improve their risk management systems.

Answer: Mr. Cousins: To ask the Chancellor of the Exchequer what steps he is taking to encourage financial institutions to improve their risk management systems. [83243] Ms Hewitt: Improving risk management is a priority both domestically and internationally. The G7 Finance Ministers and Central Bank Governors have encouraged the Basle Committee on Banking Supervision to finalise its work on revising the Basle Capital Accord so that it better reflects risk. More specifically, following the near-failure of the LTCM hedge fund, the Basle Committee published a sound practices paper setting out ways in which financial institutions could improve their risk management processes. Other international bodies are also looking at issues relating to hedge funds and their work will be coordinated by a working group of the newly established Financial Stability Forum. The Financial Services Authority are working closely with the institutions they supervise to ensure that their risk management processes follow good practice.

Secondary information

Type: Written question
Reference: 83243; 330 c453W;330 c447W
Session: 1998-99
Subjects: Banks Financial institutions EU action Management Regulation Risk assessment G7 Basel Committee on Banking Supervision