the appropriateness of the desired harmonised standards or regulatory frameworks and avoid unintended consequences. that is where the role of the g20, the basel committee, the financial stability board and iosco becomes very important. once appropriately harmonised standards or regulatory frameworks have been adopted and implemented, a consistent assessment of implementation should be undertaken. these assessments could take three forms : • systemic participants and financial market infrastructure operators should conduct periodic formal full or partial self assessments of their observance of the set standards and principles. the outcome of these assessments would lead to continuous improvement or enhancement of risk management practices, which should also meet organisational objectives rather than being just relevant for regulatory compliance purposes. • regulatory and oversight authorities, as part of discharging their mandates, should regularly assess adherence to standards and observance of relevant principles by entities that they regulate or oversee • independent assessments could be undertaken by international financial institutions ( ifi ) such as the imf and world bank, or take the form of country peer reviews, also in order to ensure that there is a standardisation of assessments to determine best practice. current requirements that have been set for banking institutions are being interrogated by various jurisdictions to see how best they could be adopted and to ensure implementation. as many of you will be aware, a second draft of revised regulations to give effect to the basel iii accord in south africa was released in september 2012. the revised regulations will come into effect on 1 january 2013, and steps had been taken to ensure that south african banks will be in a position to comply with the liquidity coverage ratio by 2013. some jurisdictions and entities viewed international standards as only the minimum benchmark and rather strive to achieve higher goals, an approach that south africa has tended to follow when it comes to capital adequacy. it is also important to always reiterate that in the implementation of standards and principles, as much as there is an important role for regulators, similarly, there is also an important role for market participants. it is in the interest of market participants to cooperate with regulators to ensure a safer financial system in which they operate. 3. areas of cooperation and collaboration by regulatory authorities cooperation among regulatory authorities should be fostered both domestically and internationally. this should happen in normal times where ideas and experiences are shared with a view to strengthening the overall financial system. this also allows for building and strengthening of relationships that would be useful in more stressful situations. due to the interlinkages of the various

my colleague dave mitchell will provide more detail on later ) require appropriate regulation, supervision and oversight. it is thus imperative that relevant regulatory authorities have the oversight powers and resources to carry out this task. in exercising these powers, authorities should be transparent, adopt relevant standards and principles and apply them consistently. it is also crucial for central banks, market regulators and other authorities to cooperate in undertaking these tasks. the need for increased cooperation also stems from the fact that the crisis has made us appreciate more the interconnectedness ( domestically and internationally ) of the various parts of the financial system we operate in, and how, in the absence of cooperation and coordination, regulatory arbitrage ( on the back of financial innovation ) can lead to a rapid build - up of systemic risks. market regulators should always strive to implement interventions that are in the interest of the system as whole and do not serve the interest of individual participants only, or certain sections of the market. although it is recognised that a disorderly failure in the financial market infrastructure or problems with systemic market participants can interrupt or impede the effective operation of markets, and cause severe systemic disruptions and financial instability, it is imperative that all regulatory actions or interventions should still maintain the correct balance. this is of course easier said than done! in most instances the impact of any crisis would differ across jurisdictions, depending on the stance of the relevant authorities on regulation and oversight, that is, whether regulators adopt more of an intrusive approach or take an arms length approach. depending on the approach taken, the market participant ’ s risk management practices will be different and therefore the impact will differ accordingly. a coordinated approach by regulators is thus imperative to ensure that the swing does not move to over - regulation, based on the experience of only one, thereby having detrimental effects or even introducing systemic risk in other jurisdictions. it is therefore imperative to ensure that any changes in the regulatory environment in different parts of the financial sector, whether within one country or across countries, are not in conflict with each other. the potential for spill overs has increased substantially over recent years, as global financial market systems have become highly interlinked, creating significant dependencies. under these circumstances, it thus becomes crucial that regulators have formalised arrangements to harmonise their regulatory practices and align these to appropriate best practice. appropriate international standard setting bodies thus become key in driving the agenda to bis central bankers ’ speeches achieve these practices. these platforms should have appropriate structures that will foster effective consultation, so as to ensure