At the request of the G20, the Financial Stability Board (FSB) has been considering the issue of the regulation of so-called "shadow banks" for some time. The FSB defines shadow banking as "credit intermediation involving entities and activities outside the regular banking system", including entities such as SPEs and hedge funds, and has specifically stated that securitisation vehicles should be subject to greater scrutiny in future. The FSB has now published a series of Consultative Documents that set out for comment its proposed policies to address the potential systemic risks associated with shadow banking in five key areas, specifically including "to assess and align the incentives associated with securitisation". The recommendations for securitisation entities will be refined and prioritised based on feedback received on the proposals, which is requested by 14 January 2013. See our Feature piece for a more detailed summary of the FSB's proposals.
European Commission Green Paper on Shadow Banking