‘We must ensure financial stability by being proactive’ MFSA Chief Executive Officer Ad Interim

Christopher P. Buttigieg

Last Updated on Thursday, 26 November, 2020 at 9:05 am by Andre Camilleri

“Financial supervision is not a static process but involves continually striving for improvement and acting in response to new challenges. It involves understanding changes and developments in financial services, such as in the field of non-bank financial intermediation, and the associated risks to financial soundness and adapting the approach to financial supervision. This was the key theme of the MFSA’s Chief Officer Supervision and CEO ad interim Christopher Buttigieg’s welcome address during last Monday’s industry webinar on Non-Bank Financial Intermediation organised by the MFSA.   “As regulators and supervisors, we must ensure financial stability by being proactive and establish an adequate regulatory framework to mitigate the bank-like risks, while at the same time reinforcing the positive impact of non-bank financial entities through our approach”.

The webinar, organised under the auspices of the newly set-up Financial Supervisors Academy (FSA) within the Authority, featured the participation of several international and distinguished speakers, from international regulators to Central Bankers and Academics.

Non-Banking Financial Intermediation (NBFI) is broadly described as credit intermediation that involves entities and activities outside the regular banking system. Typically, non-bank financial entities are subject to less stringent regulations. Examples of NBFIs include certain types of investment funds, financial vehicle corporations, and special purpose entities.

The Head of the European Systemic Risk Board Secretariat (ESRB), Francesco Mazzaferro participated in a discussion with Marco Bodellini, Associate Lecturer from the Queen Mary University of London, whereby they explored NBFI across borders from an EU and international perspective. He referred to the latest findings of the NBFI Monitoring published by the ESRB last month, and the ESRB recommendation on liquidity and leverage in investment funds, which ESMA has recently followed up on. The discussion was moderated by Michael Xuereb, Chief Officer – Strategy, Policy and Innovation at the MFSA. After the event, he commented that “Our choice of topic derives from the fact that a well-developed non-bank financial sector is as an important component of a healthy financial system that can provide a sound base for growth in the economy. However, as non-banks continue to become more important within the financial landscape – they present new challenges for regulators and supervisors”. 

In his concluding remarks during the webinar, Calvin Cassar, MFSA’s Head of People & Culture and FSA outlined how the Non-Banking Financial Intermediation webinar resonates with the FSA’s aim in wanting to create a platform for highly competent contributors to share knowledge and experience in relation to supervisory and regulatory matters. He also emphasised how the FSA looked at offering this platform in a way that is as open and inclusive as possible going forward.

Other speakers included: Giuseppe Loiacono – Adjunct Professor at SciencesPo Paris University and the University of Evry, Paris, Birgit Puck- Managing Director Securities Supervision, Austrian Financial Market Authority, Konstantinos Kanellopoulos – Head of Financial Risks Monitoring Section, Financial Stability Department, Bank of Greece, Kitty Moloney – Head of Market-Based Finance, Central Bank of Ireland, Mariana Gkoutse, Senior Analyst and Theresa Fenech, Analyst, at the MFSA.

The webinar was attended by delegates from various National Supervisory and Regulatory Authorities, European Supervisory Authorities, financial stability and research departments of Central Banks, EU Officials and Academics.

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