PwC's Managing upstream risk: Regulatory reform review - An asian perspective November 2013 | Page 6

o More generally, ESMA hopes that issuers
will enhance their disclosures on exposure to
credit risk, its mitigation (e.g. by collateral,
guarantees or credit default swaps), analysis
of specific concentrations of credit risk and
disclosure of impairment policies in order to
enable investors to assess overall credit risk.
There is still too much unclarity in the area of
liquidity and funding risk, asset encumbrance
and fair value measurement of financial
instruments.
• EU Governance in the Financial Reporting
area - ESMA’s view that endorsement of IFRSs
should be entrusted to a body that operates by its
constitution in the public interest and respects
the following principles:
o Ensuring independence from private
stakeholders’ interests which has been
identified as a significant weakness of the
current system. Of course, this independence
does not preclude in any way extensive
consultations of market participants as part of
the regulatory process;
o Ensuring that all EU Member States are
represented; and
o Ensuring proper interaction with existing
European authorities playing an important
role in the area of financial reporting.
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Regulatory Reform Review |

Singapore
Closer to home. MAS announced on 14 November
2013 that an assessment under the IMF’s Financial
Sector Assessment Programme (FSAP)1 has found
Singapore’s financial sector to be well-regulated and
highly developed. The assessment by the IMF affirms
Singapore’s standing as a sound and stable financial
centre. Some highlights in the report2 include:
• Singapore presents a very high level of
compliance with international standards for
the regulation and supervision of the banking,
insurance and securities sectors, and financial
market infrastructures.
• Stress tests conducted under the assessment
indicate that banks and insurers are resilient to
adverse macroeconomic scenarios.
• Crisis management and resolution arrangements
are generally strong. The necessary legal
framework is in place, with tools and
responsibilities clearly allocated among public
bodies and robust arrangements for information
sharing and coordination.
The FSAP is an in-depth external assessment that
contributes to a deeper understanding of the
stability and resilience of a country’s financial sector
conducted on 25 jurisdictions every five years.