The success of macroprudential policies in the Emerging Asia region will depend on
effective regional consultation and co-operation. The need for such co-operation will grow as
ASEAN financial integration proceeds, increasing the need for regulators in individual
countries to have information on the conditions of foreign banks and other financial
institutions participating in their domestic markets and on the activities of their own
institutions abroad. European countries have a well developed array of institutional
arrangements suitable for co-operation on macro-prudential issues, now centred
on the European Systemic Risk Board that was established in 2010. But these are at a
much earlier stage of development in Asia. Co-operation on financial matters has been
mainly carried out under bilateral memoranda of understanding (MOU) among country
regulatory agencies (Lim et al., 2011). The degree of participation through these MOU
varies among the Emerging Asian countries. A high-level Committee on Monetary and
Financial Stability (MFSC) was formed in 2007 under the Executive Committee for East
Asia and Pacific Central Banks (EMEAP). This committee now focuses on information
sharing and joint monitoring of global and regional financial developments but could be
developed further into a forum for closer for closer and more effective co-operation on
country macro-prudential policies