Canada's Flaherty to meet with banks next week

Thu Jun 5, 2008 7:34pm EDT
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OTTAWA (Reuters) - Canadian Finance Minister Jim Flaherty will meet with the chief executives of major Canadian banks on Monday to discuss new financial reporting rules, he said on Thursday.

Finance ministers from the Group of Seven rich countries agreed in April to a set of recommendations for avoiding another financial market crisis like the credit troubles that originated in the U.S. subprime market meltdown.

Flaherty said at that time he would push Canadian banks to adopt some the recommendations, which include common disclosure standards, more open risk-management and valuation methods with regard to their exposure to complex credit products.

After a meeting with the banks in late April, he expressed confidence they would comply with the "leading practices for disclosure" within 100 days.

Canadian banks, widely considered to be well-capitalized, have largely complied with the disclosure requirements but need to do more, he said.

The latest Canadian bank to report a writedown due to the credit crunch was Canadian Imperial Bank of Commerce, booking at pre-tax loss of C$2.48 billion on structured credit in the second quarter, on top of charges of C$3.4 billion for U.S. mortgage-related securities and credit protection in the first quarter.

(Reporting by Louise Egan; editing by Rob Wilson)

<p>Finance Minister Jim Flaherty speaks during Question Period in the House of Commons on Parliament Hill in Ottawa June 4, 2008. REUTERS/Chris Wattie</p>