Today, Bank Negara Malaysia hosted the second meeting of the Financial Stability Board (FSB) Regional Consultative Group for Asia in Kuala Lumpur, Malaysia. The group was established pursuant to the FSB's announcement in November 2010 that it intends to expand and formalise outreach beyond its membership. To this end, six regional consultative groups were established to bring together financial authorities from FSB member and non-member economies to exchange views on vulnerabilities affecting financial systems and on initiatives to promote financial stability.

At their meeting today, members of the FSB Regional Consultative Group for Asia discussed issues relating to vulnerabilities and regional financial stability, particularly the implications on the macroeconomy, markets and funding liquidity arising from the deleveraging of European financial institutions. In this context, they also discussed policy options to address the impact and negative consequences of external and domestic developments. The group also reviewed the FSB's activities and initiatives since it last met and discussed implementation challenges facing the region. More specifically, members discussed issues relating to the work on systemically important financial institutions, strengthening the monitoring and regulation of shadow banking and improving oversight of over-the-counter derivatives. The group also discussed the consequences of the global financial reforms on emerging markets and developing economies.

The FSB Regional Consultative Group for Asia is co-chaired by Governor Choongsoo Kim, Bank of Korea and Governor Zeti Akhtar Aziz, Bank Negara Malaysia. Membership includes financial authorities from Australia, Cambodia, China, Hong Kong SAR, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Pakistan, Philippines, Singapore, Sri Lanka, Thailand and Vietnam. The inaugural meeting of this group was held on 14 November 2011 in Korea.