Oct. 21 (Bloomberg) -- Federal Reserve Bank of New York President William C. Dudley said that while “considerable progress” has been made since the credit crisis began, there’s “still much to do” to reduce risks in the financial system.
“In particular, transparency into risk management practices remains poor,” Dudley said in the text of remarks given yesterday in New York and released today. “Investors have little information by which to assess the competencies of firms as risk managers or how well firms will likely do in adverse economic circumstances.”
For example, investors are trying to assess banks’ exposure to the European crisis and “are uncertain about how to think about” banks with “huge books of business that net down to more modest net exposures,” Dudley said. “We need to figure out better ways to present these exposures and risks in the firm’s disclosures.”
Dudley didn’t comment on the outlook for monetary policy or the economy in the remarks.
--Editors: Scott Lanman, Kevin Costelloe
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