Navigating Transformational Change of the Global Financial Landscape: Realizing Systemic Stability, Avoiding Unintended Consequences
On July 25-26, the Bretton Woods Committee, in partnership with Deloitte and the Smith School of Business at the University of Maryland, brought together more than sixty industry leaders and government and multilateral officials involved in implementing global financial reforms for an action-oriented roundtable discussion. Participants examined how to better manage systemic risk among market participants and how to move toward effective harmonization and integration of regulatory standards and practices.
The discussion began on July 25 with an opening dinner at the Newseum. Barbara Rehm, Editor at Large for American Banker, marked the two-year anniversary of the Dodd-Frank Act by outlining her thoughts on the successes of the Act to date, as well as the challenges remaining for financial institutions and regulators.
On July 26, participants gathered at the Willard Intercontinental Hotel to assess the direction implementation efforts are taking and to consider whether governments and industry are on a path to create an environment that incentivizes early detection of systemic risks. They also explored whether current methods of collaboration, information dissemination, and policy coordination balance prudence, safety, and soundness with long-term institutional viability and economic growth objectives.
The event began with keynote remarks from Michael Helfer, Vice Chairman, Citigroup. Mr. Helfer described how "rigorous analysis and bold thinking" are needed to prevent "future financial disasters," "ensur[e] long-term stability of global financial markets, and promot[e] a resilient, innovative and profitable financial industry."
Participants then divided into groups to examine five issue areas:
- Recovery and Resolution
- Macro-prudential Analysis
- Emerging Systemic Issues
- Payment, Clearance, and Settlement
- Non-bank SIFIs
Under the direction of discussion leaders drawn from both current and former bankers, regulators, and industry observers, each group sought to identify actionable ways forward in their respective topic. Participants then reassembled for a larger group conversation led by Donald Kohn, Bretton Woods Committee member and Former Vice Chairman, Board of Governors, Federal Reserve System.
Finally, participants heard Mary John Miller, Under Secretary of Treasury for Domestic Finance. Under Secretary Miller provided her thoughts on the progress in "implementing regulatory reform and the challenges that remain, particularly in connection with identifying and addressing risks to financial stability."
A compendium of the event's conclusions will be forthcoming.
The Committee is grateful to members Nancy Jacklin of Johns Hopkins SAIS, Don Kohn of the Brookings Institution, Joni Swedlund of Deloitte, and others for their guidance and support in preparing for this event.