Global Leadership in Financial Supervision Tackling ...

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AGENDA

TC International Program for Securities Regulators: Expanded IOSCO Principles and Crisis Management

2012

Toronto Centre International Program for Banking Supervisors

Systemic Risk IdentificationSupervisory Tools of Intervention Recovery and Resolution Frameworks

Global Leadership in Financial Supervision

Tackling currenT SuperviSory iSSueS To STrengThen Financial STabiliTy

June 15-20, 2014Toronto, Canada

Program Overview & AgendaregiSTer noW!

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Program Overview Program Objectives

Who should attend? This program is designed for mid to senior-level staff involved in regulatory and supervisory activities at central banks, supervisory authorities, deposit insurers and resolution agencies who want to expand their knowledge, share best practices, and be better prepared for future financial crises. Participants should have at least 3 years working experience in financial sector supervision, analysis, or policy and planning.


early bird deadline April 1

2014




Upon completion of this program, participants will better understand:

The relevance of the macro-prudential and micro-prudential dimensions

How to improve our analytical tools, measurement and assessment of systemic risk

How to implement a stress testing program at a supervisory authority

How a supervisory authority develops a supervisory framework for D-SIBs

The importance of policy coordination issues

The challenges of home - host supervisory and regulatory coordination

How does resolution and recovery planning relate to crisis preparedness and management

How to address the perils of shadow banking activities

The topic of how to assess and address systemic risk in the financial system has

been at the center of the regulatory and supervisory stage since the wake of the global financial crisis. While plenty of good material, theory and guidance have been produced internationally, supervisors around the world find it challenging when trying to develop ways to incorporate this into their supervisory frameworks and put into practice these new processes in their Agencies.

The practical implications of how supervisors address systemic risks spans from how to enhance their systemic risk identification, measurement and assessment capabilities together with what tools and processes they should have in order to manage and control the building of these risks. Equally important is to be prepared for any crises and therefore build robust crisis preparedness and recovery and resolution plans. These implementation challenges stem not only in the complexities and interconnectedness of the markets and instruments, but also in the practical difficulties of dealing with systemically important financial institutions domestically and globally, information gaps for micro and macro prudential surveillance, shadow banking and the complexities of achieving effective policy coordination between domestic agencies and supervisory authorities in other jurisdictions. This program is meant for supervisors to share and discuss their practical implementation experiences and challenges around these issues.

Supervisors should be asking themselves: How can we improve our systemic risk measurement and assessment capabilities? How to implement stress testing programs and how to ensure they feed into the macro-prudential surveillance work that the supervisory and other agencies do? How to encourage financial institutions to conduct their own stress tests? How to supervise and monitor systemically important institutions, both Domestic Systemically Important Banks (D-SIBs) and any global G-SIBIs either as host or home supervisor? How should all these elements be factored in the recovery and resolution plan frameworks? Are we prepared and will be alert enough to identify future risk build ups early enough to take appropriate intervention actions and maintain financial stability?

This program is highly interactive and by hearing case studies and being involved in group activities and discussions lead by our program leaders who are regulatory and supervisory experts, participants would learn from each other, share experiences and compare practices from around the world. In addition, throughout the week and with the guidance of our program leaders, participants would be putting into practice the action planning and stakeholder management communication concepts, thereby enabling them to develop action plans for any specific financial stability improvements they wish to make in their agencies when they return.

June 15-20, 2014

Location:

Toronto, Canada

regiSTer noW!







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Sunday, June 15 Networking Tour to Niagara Falls 18:00 – 21:00 Ice breaker and welcome dinner

Monday, June 1608:15 – 08:45 Welcome and Opening Remarks

Mr. Babak Abbaszadeh, President and CEO, Toronto Centre Group Photograph

08:45 –10:00 SeSSiON 1: Round table of Participants Participants introduce themselves and provide their objectives for the program

10:00 – 10:15 Break

10:15 – 12:30 SeSSiON 2: Systemic Risk identification - Supervisory Tools of intervention - Recovery and Resolution Frameworks Panel Discussion

Barry Johnston / Clive Briault / Jan Willem Van der Vossen / Usha Thorat Speakers to provide their perspectives on:

• How can supervisors position themselves to have effective contribution in the decision making process in a systemic crisis • What is the space and role of supervisors in the macroprudential field

• Challenges in implementing stress testing programs and what supervisory actions these results trigger • Challenges in establishing recovery and resolution frameworks

12:30 – 13:30 Lunch

13:30 – 15:00 SeSSiON 3: identifying Risks: A Macroprudential Perspective Clive Briault • Identifying Risks to Financial Stability

• Contagion and Interconnection Effects • Macroprudential Policy and Tools

15:00 – 15:15 Break

15:15 – 16:30 SeSSiON 4: Action Planning Salvador Chang Participants will learn about a framework for tackling challenges faced at work. • Assess the challenge confronting you with options to consider

• Outline a plan, analyze stakeholders, and project implementation

16:30 – 17:00 Action Planning Participants will start applying the action planning methodology with the assistance of program leaders. The first

day will focus on understanding the situation and the development of a precise definition of the problem/challenge identified by the participant.

June 15-20, 2014Location:

Toronto, Canada

Program Agenda

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Tuesday, June 1708:15– 08:30 ideas i will Use

08:30 – 10:00 SeSSiON 5: Stress Testing Design and implementation Challenges Clive Briault • Objectives of Stress Testing

• What do supervisors want to do and what do we expect regulated firms to be doing themselves? • Calibrating and running a stress test

10:00 – 10:15 Break

10:15 – 12:30 SeSSiON 5 (CONT’D.): Group exercise – Stress Testing Understanding the what and the how, and what to do with results Clive Briault • What to stress test • How would you do a stress test • What to do with the results

12:30 – 13:30 Lunch

13:30 – 14:30 SeSSiON 6: Stakeholder Communication Gerry Lewis A session on the approach for persuading stakeholders to support your Action Plans: • Analyze stakeholders – who they are, what they like and dislike about your proposal, and what is needed to get

their support and overcome resistance. • Four box model for effective persuasion and communication

• How to build a “burning platform” for change.

14:30 – 15:15 SeSSiON 7: identifying and Responding to Risks posed by SiFiS Barry Johnston • Issues in the assessment of systemically important financial institutions (SIFIs) • Criteria that can be used to identify SIFIs • Assessment techniques for identification

15:15 – 15:30 Break

15:30 – 16:30 SeSSiON 7 (CONT’D.): identifying and Responding to Risks posed by SiFiS Barry Johnston

16:30 – 17:00 Action Planning Participants will continue working on the action planning with the assistance of program leaders. In this session,

they should be working in setting the goal and the outline of their plan.





Wednesday, June 1808:00– 08:15 ideas i will Use

08:15 – 09:15 SeSSiON 8: Capital Flows Measures (CFMs) - Part of the Tool-Kit For Financial Stability ? Usha Thorat • The impact of volatile capital flows on emerging market economies in the context of quantitative easing and tapering • How CFMs can become part of the tool-kit for financial stability • Alignment with Monetary and Macroprudential measures

09:15 – 10:00 SeSSiON 9: Operational Risk Management – Any Role in Financial Stability? – A Canadian Perspective James Dennison

• The role of supervisors in ensuring appropriate Operational Risk Management • Supervisory Tools and Effectiveness • Challenges and banks response

10:00 – 10:15 Break

10:15 – 11:45 SeSSiON 10: Developing a Supervisory Framework for DSiBs Jan Willem Van der Vossen • How a supervisory authority develops supervisory frameworks for DSIBs

• What role the supervisors play in requiring banks to develop adequate living wills • Cross border and home - host issues under power disparity

11:45 – 12:30 SeSSiON 11: Case Study – identifying and Responding to Risks Barry Johnston

Introduction to the case study and objectives

12:30 – 13:30 Lunch

13:30 – 15:00 SeSSiON 11 (CONT’D.) : Case Study – identifying and Responding to Risks Barry Johnston

Participants work in teams that will analyze and discuss: • Issues to consider in the assessment of systemic importance • The challenges in identifying and dealing with systemically important entities in an environment of imperfect information • The use of quantitative indicators and analytical approaches in assessing vulnerabilities and systemic importance

15:00 – 15:15 Break

15:15 – 16:30 SeSSiON 11 (CONT’D.) : Case Study – identifying and Responding to Risks

• Participants present results and discuss • Final debrief, conclusions and take-aways from the case

16:30 – 17:00 Action Plan Participants will continue to work on their Action Plan. In this session participant should finish the details of the plan

to address the challenge and/or problem identified, analyze stakeholders and define the communication strategy to gain their support.

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Thursday, June 1908:15– 08:30 ideas i will Use

08:30 – 10:00 SeSSiON 12: Shadow Banking and Systemic Risk Barry Johnston

• Challenges assessing the risks of shadow banking activities • Assessing the importance and risks of other non-banking non-supervised activities to the financial system • Limitations of policy tools and the supervisory response

10:15 – 10:30 Break

10:30 – 12:30 SeSSiON 13: Recovery Planning Jan Willem Van der Vossen

• Framework for establishing recovery planning at the supervisory level • How does recovery planning relate to crisis preparedness and management • When and how supervisors should exit the recovery phase

12:30 – 13:30 Lunch

13:30 – 15:00 SeSSiON 14: Resolution Strategies and Plans Clive Briault

• What are your objectives as a supervisor • Key attributes for effective resolution. Do you have all the necessary powers and tools? • Bail in – how are you going to make it work? Cross border and Home/Host issues

15:00 – 15:15 Break

15:15 – 16:30 SeSSiON 14 (CONT’D.): Group exercise- Resolution Strategies and Plans Participants will participate in a group exercise designed to highlight the critical importance of effective resolution planning

16:30 – 17:00 Action Plan Participants will finalize their Action Plan material for presentations on Friday

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Friday, June 2008:15– 08:30 ideas i will Use

08:30 – 10:00 Changes in Resolution and Recovery Planning – A Canadian Perspective Olga Krokhina

• The responsibilities of supervisors, financial institutions and other authorities • How is it being implemented? Roll-Out plan and Timelines • Achievements and implementation challenges. Next steps

10:00 – 10:15 Break

10:15 – 12:30 Action Plan Presentations by Participants Participants will present their Action Plans to the group and receive feedback from program leaders and colleagues

12:30 Closing Ceremony and Certificate Presentation

18:30 Farewell Dinner – CN Tower

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June 15-20, 2014Location:

Toronto, Canada

Program Leader Biographies

Clive Briault Clive Briault is a senior adviser on regulation at KPMG, an adviser to a number of supervisory authorities in Europe, and has acted as a consultant to the IMF, World Bank and Asian Development Bank. He is also a non-executive director of a financial services company in the UK.

After completing an MPhil in Economics at Nuffield College, Oxford, Clive joined the Bank of England in 1980. His roles there included Head of Monetary Assessment and Strategy (1991-1996), and Head of Capital and Wholesale Markets Division (from 1996-1998). He joined the Financial Services Authority (FSA) at its formation in 1998 as Director of Central Policy, and was Director, Prudential Standards from 2001 to 2004. Clive was Managing Director of Retail Markets at the FSA from April 2004 to April 2008. He had responsibility for the regulation of firms and groups which offer services primarily for the retail markets, as well as the associated policy framework, the FSA’s firm and consumer contact center, and its financial capability work.

James Dennison James Dennison is the Managing Director of the Operational Risk Division at the Office of the Superintendent of Financial Institutions Canada (OSFI), where he is responsible for OSFI’s supervisory effectiveness of operational risk at federally regulated financial institutions, including the effectiveness of governance oversight and operational risk management programs. Mr. Dennison also oversees the management of various operational risks including management information systems, technology, business continuity, information security, and outsourcing.

Prior to OSFI, James Dennison was the Vice-President and Chief Risk Officer of CIBC Mellon, a leading provider of financial services for institutions and corporations, providing asset servicing, multicurrency accounting, information delivery, securities lending and foreign exchange services in Canada. In his role at CIBC Mellon, James was responsible for designing, promoting, and maintaining an enterprise-wide risk management framework, including the operational risk management program. James also served on Lakehead University’s Board of Governors, where he was the Chair of the University’s Audit and Risk Management Committee.

Barry R. Johnston Barry R. Johnston, a regular Toronto Centre program leader is a Former Assistant Director, Monetary and Capital Markets Department, IMF (retired). He is most recently the Director of the course on Financial Stability, Systemic Risk and Macroprudential Policy, presented at the Singapore Training Institute and the Joint Vienna Institute. Mr. Johnston has participated in a series of Toronto Centre – Bank Indonesia Macroprudential Surveillance programs in Indonesia.

From 2006-2010, he was the Assistant Director of Monetary and Capital Markets Department of the IMF, which included responsibility for financial sector surveillance and assessments (FSAPs); leadership of the IMF/BIS/FSB team that prepared the guidance to assess systemically important financial institutions; and financial sector aspects of the IMF/G 20 Mutual Evaluation. He also led the IMF team to identify information gaps that contributed to the global financial crisis. Previous positions at the IMF include Assistant Director of the Financial Market Integrity Division with responsibility for anti-money laundering (AML/CFT), and the assessment of offshore financial centers; Chief, Monetary and Exchange Policy Analysis Division, responsible for financial sector policy, analysis and research at the Fund; and Chief, Exchange Regimes and Market Operations Division, responsible for members’ foreign exchange systems and the liberalization of capital movements. Prior to joining the IMF, Mr. Johnston worked at the Bank of England, the British Treasury and the Bank for International Settlements on monetary and financial sector policy.

Since retiring from the IMF in 2011, Mr. Johnston has worked as a consultant for the World Bank on their Global Financial Sector Development Report, and their Overview Course on Financial Sector Issues. He is a Professional Associate of the International Center for Financial Regulation. He has published extensively on financial sector issues. He is a graduate of Queens University Belfast and Manchester University.

Olga Krokhina Olga Krokhina is a manager, Recovery and Resolution Planning, at the Office of Superintendent of Financial Institutions (OSFI). In this capacity, Olga has been developing RRP expectations for Canadian financial institutions, leading RRP assessment work and interfacing with domestic and international regulatory agencies. Since 2002, Olga has held a variety of supervisory positions at OSFI, including supervision of the largest bank, credit risk assessment, Basel II implementation and ERM. Prior to joining OSFI, Olga worked in the financial sector and academia.

Usha Thorat Usha Thorat, former Deputy Governor, Reserve Bank of India, took over as Director of the Centre for Advanced Financial Research and Learning (CAFRAL) in January 2011. CAFRAL is promoted by Reserve Bank of India as a centre of excellence for research and learning in the field of banking and finance.

After a career of nearly four decades with the Reserve Bank of India, Mrs. Usha Thorat retired in November 2010 as its Deputy Governor, a post which she held for five years. As Deputy Governor, Mrs. Thorat’s specific responsibilities included banking regulation and supervision, rural and urban cooperative banks and currency management. She was also responsible for the developmental role of the RBI for facilitating inclusive growth, especially in regard to rural credit, SME and financial inclusion.

Prior to her elevation as Deputy Governor, Mrs. Thorat was the Executive Director of the Reserve Bank (since April 2003). As Executive Director, she represented Reserve Bank of India on the Bank for International Settlements’ Committee on Global Financial Systems (CGFS). She had also served as a member on the CPSS‐IOSCO Task Force on Securities Settlement Systems (1999‐2001).

Jan Willem Van der Vossen Jan Willem Van der Vossen is currently a Financial Stability Consultant and formerly an advisor in the Monetary and Capital Markets Department of the IMF. Prior to joining the IMF in 1993, he was Deputy Chief, Banking Supervision Department-General Affairs of the Central Bank of the Netherlands. Before entering the service of the Central Bank, Mr. Van der Vossen was an officer in the Foreign Service of the Netherlands.

At the IMF, Mr. Van der Vossen most recently worked on the development of criteria for the assessment of countries’ Basel II implementation, represented the IMF at meetings of the Basel Committee’s Core Principles Liaison Group, later renamed International Liaison Group. In this context he was a member of the drafting group for the revision of the Basel Core Principles, and collaborated with the Basel Committee in drafting guidelines for Basel Core Principles self-assessments. He headed IMF FSAP teams to a variety of countries, and in cooperation with the World Bank and the Federal Reserve organized a series of successful annual policy level seminars on topical issues in banking supervision. He has accepted numerous speaking and teaching assignments on topics of banking supervision for the IMF, World Bank, Basel Committee, Financial Stability Institute and the Netherlands Central Bank





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