On February 1, the UK Financial Services Authority (FSA) and the Securities and Exchange Commission announced the results of a meeting held between Lord Turner and Hector Sants, Chairman and Chief Executive of the FSA, respectively, and Mary Schapiro, SEC Chairman.

The announcement disclosed that the UK and U.S. regulators discussed, among other matters: corporate governance and executive compensation; regulation of hedge funds and investment advisers and the protection of customer assets; disclosure regimes around client asset risks; market infrastructure, particularly relating to central counterparties for over-the-counter derivatives; market supervision; and cooperation on cross-border supervision.

The regulators agreed that enhanced supervisory cooperation was crucial to market integrity. In order to facilitate expanding cooperation in areas such as oversight of credit rating agencies, hedge fund advisors and the clearing of OTC derivatives, they agreed to undertake a review of the current 2006 Memorandum of Understanding Concerning Consultation, Cooperation and the Exchange of Information Related to the Supervision of Financial Services Firms and Market Oversight.

According to FSA Chief Executive Hector Sants, “Global cooperation between regulators is central to tackling the reform agenda, and the relationship between the FSA and the SEC is key for international markets.” SEC Chairman Schapiro said, “This dialogue has proved its utility again in allowing the SEC and FSA to share expertise and experiences regarding the rapid changes occurring in our capital markets.”

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