The Minister of Finance announced during the 27 October 2010 Medium Term Budget Policy Statement, a revised mandate of the Bank to include particular responsibility for financial stability.
When considering such responsibility, the Bank looked at what such a macro prudential mandate needs to take into account, and this could entail;
- Assessing risks to system wide stability
- Sharing risk assessment with other agencies / the public
- Contributing to the development of macro prudential instruments and policies
- Developing and implementing any discretionary policy actions to mitigate risks
- Recognising that there may be different time horizons that are appropriate for different decisions
- Needing to ensure that there is a longer term horizon when resolving financial stability crises.
In this regard, the Bank has undertaken a number of steps. It has established an internal Financial Stability Committee which meets every second month, alternate to the Monetary Policy Committee (MPC). It has an expanded Committee, whose membership includes all members of the MPC. It is chaired by the Governor of the Bank.
In addition, the Bank issues a Financial Stability Review twice a year.