Annex V.2.

INTERNATIONAL CODES AND STANDARDS FOR FINANCIAL MARKETS

Codes and standards of best practice arose out of the need to overcome informational asymmetry, help improve the functioning of markets and aid in monitoring performance. Their provision has in fact become an important element in the current debate on the new financial architecture. Since the advent of the Asian crisis, a number of international organizations and other bodies have either revised existing codes or standards or developed new ones for certain segments of the financial markets.

These codes and standards are expected to (i) give clarity to the roles and responsibilities of each participant in the market; (ii) increase the availability of information and reduce uncertainty, which fosters herd-like behaviour on the part of investors; (iii) increase the transparency and accountability of financial institutions as well as the governments; (iv) facilitate monitoring by improving the extent of comparability of performance across markets; and (v) establish international benchmarks or norms in various fields. It is strongly believed that the adoption of internationally recognized standards and codes of good practices can help improve economic policy-making and strengthen the international financial system.

Initiatives for developing codes and standards have been undertaken by different international organizations and agencies according to their focus or specialization. Adherence to these codes and standards is not compulsory, but based on a voluntary approach. Nevertheless, institutions like IMF and the World Bank encourage developing countries to comply with the standards proposed by themselves and other standard-setting bodies such as the Basle Committee, and offer technical assistance in implementing the codes. However, since many of the codes (for example, the Capital Accord) were developed for the situation in developed countries, there is the risk that the standards may not be equally relevant to the situation in the developing and least developed countries.

The following provides a brief overview of the features of the more important standards and codes of best practices relevant to financial markets.

Accounting. The International Accounting Standards Committee is an independent private sector body formed in 1973 with members from 142 professional accountancy organizations in 101 countries. The objective of IASC is to formulate and publish accounting standards for the private sector. It also aims to work towards improving and harmonizing the different sets of regulations, procedures and accounting standards related to the reporting of the financial statements. It intends to achieve uniformity in the accounting principles used by the private sector for financial reporting across the world. Since 1974, IASC has published and updated series of 39 International Accounting Standards addressing specific topics such as the presentation of financial statements, business combinations, and financial instruments: recognition and measurement.^a

To illustrate its thrust to instil a harmonized reporting format, IASC suggests the following framework for the preparation and presentation of financial statements: (i) objective of the statement; (ii) underlying assumptions; (iii) qualitative characteristics of financial statements, such as relevance, reliability, and constraints on relevant and reliable information; (iv) elements of financial statements - asset, liability, equity, and income and expenditure; and (v) concepts of capital and capital maintenance. The set of core accounting standards is designed in such a way that private corporations could use them for cross-border offerings and listings in all global financial markets.

The International Federation of Accountants is formulating accounting standards which are based on the International Accounting Standards for the public sector. Work is expected to be completed by 2001.

IASC does not impose the use of its standards on its members - the adoption of standards remains the decision of national authorities, or self-regulatory organizations or enterprises. In some cases, stock exchanges require foreign issuers to present financial statements in accordance with the International Accounting Standards format as a precondition for listing on the exchange.

IMF has established contacts with IASC and IFAC. While accounting and auditing standards are not one of the core competencies of IMF, these standards are important for certain areas of its work. The adoption of international accounting standards in a country has become an element of recent stabilization programmes of IMF.

Auditing. The International Auditing Practices Committee is a committee of IFAC and its membership consists predominantly of national accountancy organizations. The objective of IAPC is to improve the degree of uniformity of auditing practices and related services throughout the world.

The majority of IFAC members use the IAPC International Standards on Auditing as a basis for developing their own national standards. However, these standards have no legal force. Members are simply expected to use their best efforts to see that IFAC and IASC principles and standards are applied in their domestic auditing systems.

The World Bank has supported both IASC and IFAC in developing harmonized accounting and auditing standards and, in fact, has provided funding from its Development Grant Facility to accelerate standard-setting in both bodies. It also participates as an observer in several committees and disseminates the auditing standards for use in the reporting of Bank-assisted project activities.

Banking supervision. The work on developing principles to promote prudential norms in banking is relatively advanced. The Committee on Banking Supervision was established at the end of 1974 in the wake of the failure of Bankhaus Herstatt in Germany. The first task of the Committee was to consider methods of improving early warning systems for banking crises. Subsequently, the Committee explored international cooperation for improving the quality of banking supervision worldwide, mainly by way of improving the exchange of information on national supervisory arrangements and enhancing the techniques for supervising international banking businesses and by setting minimum standards in areas where they are considered desirable. Among the significant outputs of the Committee are the Basle Capital Accord and the Basle Core Principles for Effective Banking Supervision.^b

The Basle Committee on Banking Supervision promulgated the Basle Capital Accord in July 1988, to ensure that internationally active banks maintain a level of capital commensurate with the risks they bear. The Accord laid down minimum capital adequacy requirements (8 per cent ratio of capital to weighted risk assets) based on relative levels of exposure to various forms of credit risk, both on and off balance sheet. By September 1993, all banks in G-10 countries with significant international operations were meeting or exceeding the minimum requirements.

Given the growing extensive dealings between corporate customers from two or more countries, the concept of country risk is expanding well beyond its traditional scope, which primarily encompassed only sovereign risk and transfer risk.^c The expansion of G-10 creditor claims against foreign commercial entities has forced banks to broaden their concept of credit risk management to incorporate the potential default of foreign private sector non-bank enterprises arising from country-specific economic factors. The Asian crisis, as well as other recent developments, has resulted in banks separately identifying individual foreign enterprises that are more exposed to local country conditions than others.

In response to the deterioration in the capital ratios of main international banks, as well as the growing risks of heavily indebted countries, the Basle Committee had resolved to increase the overall amount of capital in the banking system and work towards greater convergence in the measurement of capital adequacy. The Basle Accord is currently under review. A proposed new framework was issued in 1999 in the form of a consultation paper. Comments on this are to be made before March 2000. Its major features are as follows: (i) minimum capital requirements which seek to enhance the standardized rules in the 1988 Basle Accord; (ii) supervisory review of an institution's capital adequacy and internal assessment process; and (iii) market discipline as a lever to strengthen disclosure and encourage safe and sound banking practice.^d

The Board of the Basle Committee on Banking Supervision issued the Core Principles for Effective Banking Supervision^e in 1997 in order to strengthen the supervisory systems of national financial markets. As minimum standards, the Core Principles comprise 25 basic principles that are considered essential for any supervisory systems to be effective. Broadly, these principles cover the following areas: pre-conditions for effective banking supervision; licensing and structure; prudential regulations and requirements; methods of ongoing banking supervision; information requirements; formal powers of supervisors; and cross-border banking. These principles reflect a significant development in at least four respects: (i) they are comprehensive and cover all aspects of banking; (ii) they provide a checklist of good practices for use by supervisors, international financial institutions, rating agencies and other market participants; (iii) they were drawn up with the active participation of non-G-10 supervisory authorities; and (iv) they apply to G-10 and non-G-10 countries alike.

The Basle Committee is continuing to develop standards in key risk areas such as credit risk management and disclosure. IMF and the World Bank use the Core Principles document to assist individual countries in strengthening their supervisory arrangements with the objective of promoting macroeconomic and financial stability. This document constitutes the main background material for the training offered at the Toronto Centre for Financial Sector Supervision set up by BIS, the Government of Canada and the World Bank.

Bankruptcy. Restructuring a financial system requires a system in which the assets of a failed entity can be priced and sold in a market in an efficient manner. In this way, resources that would otherwise have remained unused could be injected back into the real sector and converted into productive investment. Crisis resolution hinges, in no small measure, on the timely and efficient disposal of assets. However, the experience of the Asian crisis has shown that the process can be hindered by inadequacies in bankruptcy procedures and legislative guidelines. While the bulk of the institutional reforms pertaining to bankruptcy have to be implemented domestically, there have been a number of initiatives in addressing cross-border bankruptcy and insolvency issues.

Domestic bankruptcy systems vary considerably across countries, reflecting not only disparate legal traditions and practices but also different social and political choices. Given these differences, regional and multilateral initiatives to harmonize domestic bankruptcy laws have made little progress. More success has been achieved in promoting the harmonization of treatment for cross-border bankruptcy problems. It should be noted that initiatives in this area do not attempt to harmonize domestic bankruptcy laws.

To illustrate, the European Union adopted the Convention on Insolvency Proceedings in 1995. This Convention sets the rules for the treatment of insolvencies where the debtor has establishments and assets in more than one EU member State. It would provide, inter alia, for the international distribution of jurisdiction, choice of law, cooperation between the courts of different EU member States, and recognition of foreign judicial decisions and orders. However, the Convention has not yet been ratified by all member States and the prospects for its entering into force are still in doubt.

The United Nations Commission on International Trade Law developed a Model Law on Cross-border Insolvency which was adopted by UNCITRAL members in May 1997. This law has the following objectives: (i) cooperation between the courts and competent authorities of States involved in cases of cross-border insolvency; (ii) greater legal certainty for trade and investment; (iii) fair and efficient administration of cross-border insolvencies that protects the interest of all creditors and other interested persons; (iv) protection and maximization of the value of the debtor's assets; and (v) facilitation of the rescue of financially troubled businesses. Furthermore, the model law is designed to provide greater predictability regarding the extent to which, for example, creditor action will be recognized by a local court. It also provides for the non-discrimination of foreign creditors. Adoption of the model law is under consideration in a number of countries.

Corporate governance. Corporate governance refers to the set of principles, rules and practices that define the agency relationship between the stakeholders (shareholders, lenders and, in some countries, employees) in a corporation and the persons entrusted with its management. By definition, corporate governance aims to ensure a proper discharge by managers of their duties to the corporation's constituents. In this respect, managers have the fiduciary duty to maximize the value that shareholders derive from their investment in the corporation, while at the same time respecting the rights of other stakeholders.

The fragility of the financial system in a number of affected economies can be traced partly to the overly risky positions taken by many interconnected firms. Private lenders in recent years have been underpricing risk. Competition in the financial area has increased markedly and, as profits have been harder to come by, pressure to maintain or even expand profit levels may have induced some financial institutions to engage in riskier endeavours.^f

In response to a request made at its 1998 Ministerial Meeting, OECD has established a task force to develop international guidelines to improve corporate governance practices among its member countries. It is also envisioned to serve as a reference point for non-member countries. With respect to financial institutions in particular, the OECD work on institutional investors stressed the need for developing a common understanding on risk management standards and risk accounting standards. The task force is led by the OECD Directorate of Financial, Fiscal and Enterprise Affairs, and includes members from securities regulatory agencies, stock exchanges, the private sector and relevant international organizations, including IMF and the World Bank.

The OECD Business Sector Advisory Group on Corporate Governance issued a report in April 1998 entitled "Corporate governance: improving competitiveness and access to capital in global markets",^g which seeks to identify principles of sound corporate governance. The report rejected the one-size-fits-all approach to corporate governance, but recognized the need for an international reference point and identified some fundamental parameters as a basis for initiatives to improve governance. These parameters include the following points: (i) increased acceptance of maximizing shareholder value as the primary corporate objective; (ii) acceptance of increased transparency and independent oversight of management by boards of directors; (iii) making a board's practice subject to voluntary adoption and evolution, taking into account global minimum standards; and (iv) the adoption of universal rules in certain areas (such as accounting) is preferable.

Apart from OECD, other international and regional institutions are promoting better corporate governance in various ways. For example, the World Bank supports reform of corporate governance in developing countries, and has undertaken corporate governance assessments in eight countries in cooperation with APEC. EBRD has also been active in developing sound business standards and corporate practices; EBRD borrowers and co-investors are expected to commit themselves to adhering to these standards and practices.

Finally, the Basle Committee also addresses corporate governance in the context of banking supervision. It issued a paper in September 1999 entitled Enhancing Corporate Governance in Banking Organizations, which provides guidance on corporate governance in banks, based on supervisory experience in banking organizations on governance problems, and suggests the types of practices that would help avoid such problems.

Data dissemination. The Special Data Dissemination Standard and the General Data Dissemination System were established by IMF in 1996 and 1997 respectively; they are intended to enhance the quality and integrity as well as the availability of timely and comprehensive economic and financial statistics, which in turn is expected to contribute to the pursuit of sound macroeconomic policies.

GDDS is meant to be a step towards subscription to SDDS for those countries which do not yet have sophisticated statistical systems. Participation in GDDS is voluntary. The implementation of GDDS is expected to be carried out in two phases over the next six to seven years. The first phase will focus on the education and training of member countries. In the second phase, IMF staff will work directly with member countries to assist them in assessing their current practices and developing plans for improvements.

SDDS is a best-practice standard against which a country's dissemination practices can be readily measured. Although subscription is voluntary, it entails a commitment by a subscribing member to observe the standard and provide information to IMF about its practices in disseminating economic and financial data. At present, 47 countries have subscribed to SDDS. It covers four sectors of the economy, real, fiscal, financial and external, and has four dimensions: the coverage, periodicity and timeliness of the data; access by the public to those data; the integrity of the data; and the quality of the data. For each of these dimensions, SDDS prescribes two to four monitorable elements: good practices that can be observed or monitored by the users of statistics, as reported in the table below.

Summary of the Special Data Dissemination Standard

1. The data: coverage, periodicity, and timeliness Comprehensive economic and financial data, disseminated on a timely basis, are essential to the transparency of macroeconomic performance and policy.	Measure: The dissemination of economic and financial data categories has to follow the prescriptions of IMF, with the components, periodicity and timeliness as indicated.
2. Access by the public Dissemination of official statistics is an essential feature of statistics as a public good. Ready and equal access is a principal requirement for the public, including market participants.	Measures: (a) Advance dissemination of release calendars. (b) Simultaneous release to all interested parties.
3. Integrity To fulfill the purpose of providing the public with information, official statistics must have the confidence of their users. In turn, confidence in the statistics ultimately becomes a matter of confidence in the objectivity and professionalism of the agency producing the statistics. Transparency of its practices and procedures is a key factor in creating this confidence.	Measures: (a) Dissemination of the terms and conditions under which official statistics are produced, including those relating to the confidentiality of individually identifiable information. (b) Identification of internal government access to data before release. (c) Identification of ministerial commentary on the occasion of statistical releases. (d) Provision of information about revision and advance notice of major changes in methodology.
4. Quality A set of standards that deals with the coverage, periodicity and timeliness of data must also address the quality of statistics. Although quality is difficult to judge, monitorable proxies, designed to focus on information which the user needs to judge quality, can be useful.	Measures: (a) Dissemination of documentation on methodology and sources used in preparing statistics. (b) Dissemination of component detail, reconciliation with related data, and statistical frameworks that support statistical cross-checks and provide assurance of reasonableness.

Source: IMF, Special data dissemination standards, Dissemination Standards Bulletin Board, available at <http://dsbb.imf.org/overview.htm> (20 January 2000).

Under SDDS, IMF is prescribing dissemination standards for 17 data categories covering the real, financial, fiscal and external sectors of the economy, as shown below:

Categories and components of data under the SDDS

Categories	Components
Real sector
1. National accounts: nominal, real, and associated prices	GDP by major expenditure category and/or by productive sector
2. Production indices	Industrial, primary commodity, or sector, as relevant
3. Labour market	Employment, unemployment, and wages/earnings, as relevant
4. Price indices	Consumer prices and producer or wholesale prices
Fiscal sector
5. General government or public sector operations, as relevant	Revenue, expenditure, balance and domestic (bank and non-bank) and foreign financing
6. Central government operations	Budgetary accounts; revenue, expenditure, balance and domestic (bank and non-bank) foreign financing
7. Central government debt	Domestic and foreign, as relevant, with a breakdown by currency, as relevant, and a breakdown by maturity; debt guaranteed by central government, as relevant
Financial sector
8. Analytical accounts of the banking sector	Money aggregates, domestic credit by public and private sector, external position
9. Analytical accounts of the central bank	Reserve money, domestic claims on public and private sector, external position
10. Interest rates	Short-term and long-term government security rates, policy variable rate
11. Stock market	Share price index, as relevant
External sector
12. Balance of payments	Goods and services, net income flows, net current transfers, selected capital account items (including reserves)
13. International reserves	Gross official reserves (gold, foreign exchange, SDRs and fund position) denominated in US dollars
14. Merchandise trade	Exports and imports
15. International investment position
16. Exchange rates	Spot rates and three- and six-month forward market rates, as relevant
17. Population

Source: IMF, SDDS Data Categories, available at <http://dsbb.imf.org/category.htm> (20 January 2000).

The formal period for the implementation of the database system by the SDDS subscribers began in early 1996 and ended on December 1998. During that period, a member could subscribe to SDDS even if its dissemination practices were not fully in line with SDDS. A specified time was given for subscribers to adjust their practices according to the requirements.

A subscriber is expected to submit information about its data and dissemination practices (called metadata) to IMF for presentation on an electronic bulletin board maintained by the IMF Dissemination Standards Bulletin Board. The Board now provides hyperlinks between the SDDS metadata and actual country data, shown in a national summary data page, for 18 countries. It should be noted that the subscriber alone is responsible for the accuracy of the metadata and the actual economic and financial data.

IMF is encouraging SDDS subscribers to collect and release data on forward-looking indicators (for example, business surveys, orders), debt-service projections, FDI, and portfolio investment. The IMF Executive Board undertook a second review of experience with SDDS in December 1998. The review considered an extension of the data coverage of SDDS on international reserves and external debt.^h SDDS subscribers are obliged to provide information on the composition of reserve assets, other foreign assets held by the central bank and government, short-term foreign liabilities, and related activities that can lead to a drain of reserves (such as financial derivatives and government guarantees for private borrowing). Procedures for the monitoring of the observance of the standards were also established, as well as penalties such as removal from the Dissemination Standards Bulletin Board upon non-observance. However, to this date only six subscribers are reporting these data; none of them is a developing ESCAP member.

The Executive Board also agreed that the SDDS prescription should be for dissemination of full data corresponding to the new template on a monthly basis, with a lag of no more than one month, although data on total reserve assets would still be prescribed for dissemination on a monthly basis with a lag of no more than one week. The dissemination of data for the full template on a weekly basis, with a one-week lag, was to be encouraged. The new standards were started formally in August 1999, with Canada, France, Germany, Switzerland and the United Kingdom as the only participating members. The transition period for the observance of the new standards is through 31 March 2000, when all SDDS subscribers are required to disseminate data in line with the new SDDS template.

Fiscal transparency. In April 1998, the Interim Committee of IMF adopted the Code of Good Practices on Fiscal Transparencyⁱ to guide members seeking to increase fiscal transparency, and thereby to enhance the accountability and credibility of fiscal policy as a key component of good governance. The rationale for the Code is that providing better information to the public will make governments more accountable, and thereby strengthen fiscal policy credibility.

This Code rests on four principles. First, a government should clearly define its roles, responsibilities and activities which have an impact on the rest of the economy. This should be done within a clear legal and administrative framework. Second, it should make a commitment to provide comprehensive and reliable information, which includes its past, present and projected fiscal activity. Third, the process of budget preparation should be clear and should also include well-presented budget estimates that facilitate policy analysis and allow for international comparison, with clearly defined procedures of execution and monitoring. Lastly, the integrity of fiscal information should be capable of being counterchecked by a national auditing body.

Countries are encouraged to implement the code on a voluntary basis and no formal subscription process is currently envisaged. A manual on implementation of fiscal transparency has been prepared and approved by the Executive Board. The manual sets out the principles and practices in more detail, drawing on existing international standards and experiences of member countries to illustrate good practices.

Through technical assistance missions and other contacts with country authorities, IMF staff members have initiated discussion on fiscal transparency and have begun to direct technical assistance resources to help countries seeking to improve fiscal transparency. Efforts to encourage implementation of the Code have begun by focusing on a small group of countries in which a lack of fiscal transparency affects policy formulation and implementation directly. Work has also started on a pilot basis to undertake country-level assessments of fiscal policy.^j

Insurance regulations. The International Association of Insurance Supervisors is responsible for developing internationally accepted principles and standards on insurance supervision and training insurance supervisors from emerging market economies.^k Recommendations or principles produced by IAIS are meant to be advisory rather than binding for its members. In September 1997, IAIS issued two sets of standards: (i) insurance supervisory principles, addressing general issues such as licensing, ownership, change in shareholders control, off-site analysis, on-site examinations, information disclosure and supervisory powers; and (ii) principles applicable to the supervision of international insurers and insurance groups and their cross-border establishments, on-site and off-site supervision of cross-border entities, information and audit. Three additional standards were adopted in October 1998 relating to licensing, on-site inspection and supervision of derivatives. Future standards will cover solvency requirements and reinsurance. Progress in harmonizing solvency requirements will depend on having a uniform accounting standard in place. There is no uniform international standard of accounting for insurance companies, although IASC has begun a project aimed at achieving such a uniform standard by 2002.

In February 1999, the Executive committee of IAIS decided to establish a task force to elaborate a methodology of how best to assess the implementation of the IAIS principles and standards in the different jurisdictions. In addition, IAIS is responsible for training insurance supervisors from emerging economies. It has developed a self-assessment programme for its members and has solicited assistance from the World Bank in distributing the principles, standards and guidance notes to insurance supervisors.

Monetary and financial policies. The Interim Committee called on IMF to develop a code of transparency practices for monetary and financial policies, in cooperation with appropriate institutions. As a result, IMF, along with BIS, the World Bank, OECD etc., prepared a Code of Good Practices on Transparency in Monetary and Financial Policies which was adopted by the IMF Interim Committee in September 1999.^l The Code identifies practices that would enhance the transparency of central banks in their conduct of monetary policy as well as other financial policies. The transparency practices listed are designed to meet the following objectives: (i) clarity of the roles, responsibilities and objectives of central banks and financial agencies; (ii) open process of formulating and reporting of monetary policy decisions by the central bank and of financial policies by financial agencies; (iii) public availability of information on monetary and financial policies, on the grounds that monetary and financial policies can be made more effective if the public knows the goals and instruments of policy and if the authorities make a credible commitment to meeting them; and (iv) accountability and assurances of integrity by the central banks and financial agencies. Good governance calls for central banks and financial agencies to be accountable, particularly in areas where monetary and financial authorities are granted a high degree of autonomy. A compendium of good practices and other material to provide guidance on the implementation of the Code is being prepared.

Securities market regulation. Regulation of national securities and futures markets is conducted through both government regulators and self-regulatory organizations, which include securities and futures exchanges. The International Organization of Securities Commissions^m is working to establish universal principles for securities regulation, which could be adopted by official regulators. Thirty principles of securities regulators have been set out, based on three objectives: to protect investors; to ensure that markets are fair, efficient and transparent; and to reduce systemic risk. The principles are divided into eight categories: the responsibilities of the regulator; self-regulation; enforcement of securities regulation; cooperation in regulation; issuers; collective investment schemes; market intermediaries; and the secondary market. The document also provides securities regulators with a yardstick against which progress towards effective regulation can be measured. IOSCO has an extensive committee structure and produces recommendations that are meant to be advisory, rather than binding, on the membership.

IOSCO has also released a number of documents that spell out standards for various specific aspects of security trading. For instance, in March 1998, it released a consultative document entitled Risk Management and Control Guidance for Securities Firms and their Supervisors. The paper provides a benchmark by which both securities firms and their supervisors may assess risk management and control systems. A report, Methodologies for Determining Minimum Capital Standards for Internationally Active Securities Firms Which Permit the Use of Models under Prescribed Conditions was released in May 1998 advising supervisors that it was acceptable, subject to suitable safeguards, to incorporate the output of value-at-risk models in the calculation of regulatory capital for market risk for internationally active securities firms.

IOSCO and the Basle Committee have been issuing the annual survey on the Trading and Derivatives Disclosures of Major G-10 Banks and Securities Firms since November 1998. They also issued a joint paper in October 1999 outlining the revised recommendations on trading and derivatives disclosure. The IOSCO Technical Committee has collaborated with IASC to evaluate the proposed international accounting standards. This evaluation is focused on whether the Committee should recommend endorsement of the IASC core standards to its members for use by foreign issuers in cross-border listings and offerings.

Others. The BIS-based Committee on Payment and Settlement Systems is working towards improvements in the robustness of payments systems in three areas: the implementation of real time settlement payment systems; a shift to delivery versus payment settlement systems in securities markets; and the elimination of settlement lags in foreign exchange markets through the creation of a specialized bank. The BIS-based Committee on the Global Financial System is working to identify practices and structures that support deep and liquid forward markets. IMF has been working closely with the Committee on a disclosure template that would be consistent with the strengthening of the SDDS data category for reserves.

IIF has organized a series of working groups to identify best practices and develop standards in a number of areas. These include data standards for emerging market economies; best practices for financial firms to manage risk exposure to emerging market economies; common financial industry definition for non-performing loans; and criteria for loan classification.

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Footnotes:

^a The list of published and updated series of the 39 IAS standards is available at <http://www.iasc.org.uk/frame/cen2_1.htm> (14 January 2000).

^b For more details, see BIS International Convergence of Capital Measurement and Capital Standards (July 1988), available at <http://www.bis.org/publ/bcbs04a.htm> (18 January 2000) and BIS Core Principles for Effective Banking Supervision (Basle Core Principles), available at <http://www.bis.org/publ/bcbsc102.pdf> (18 January 2000).

^c This refers to the ability or willingness of a sovereign government to honour its cross-border debts and to make available foreign exchange so that otherwise viable local debtors could meet foreign-denominated cross-border claims.

^d The press release containing the main elements of the proposed framework is available at <http://www.bis.org/press/p990603.htm> (20 January 2000).

^e Together with the Core Principles, the Committee released a compendium of existing Basle Committee recommendations, guidelines and standards, and has continued to update the compendium.

^f See the discussion in William R. White, "New strategies for dealing with the instability of financial markets", paper presented at the Conference on the Management of Global Financial Markets: Challenges and Policy Options for Emerging Economies, the EU and the International Institutions, Forum on Debt and Development at the National Bank of Hungary, Budapest, 24-25 June 1999.

^g A summary of this report is available at <http://electrade.gfi.fr/cgi-bin/OECDBookShop.storefromt/1329864493/Search/Run> (20 January 2000).

^h The effort to improve data dissemination of international reserves and external debt underpins the Fund's increased focus on vulnerability assessment. Countries have begun enhanced disclosure of international reserves data based on the format of the SDDS International Reserves Template approved by the Executive Board on 23 March 1999. The countries which disseminate information on the foregoing data are Canada, France, Germany, the Netherlands, Switzerland and the United Kingdom.

ⁱ IMF, Code of Good Practices on Fiscal Transparency - Declaration on Principles, available at <http://www.imf.org/external/np/fad/trans/code.htm> (20 January 2000).

^j IMF, Experimental Case Studies on Transparency Practices (Washington DC, April 1999), available at <http://www.imf.int/external/np/exr/facts/transpar.htm> (20 January 2000).

^k Detailed information on IAIS can be obtained at <http://www.iaisweb.org/1/index.html> (20 January 2000).

^l IMF, Code of Good Practices on Transparency in Monetary and Financial Policies, available at <http://www.imf.org/external/np/mae/mft/index.htm> (20 January 2000).

^m Information on the work of IOSCO is available at <http://www.iosco.org/iosco.html> (20 January 2000).