The QFC Regulatory Authority is committed to pursuing a risk-based approach to supervision that involves monitoring of financial information and regular on-site and off-site risk assessments. The QFC Regulatory Authority continues to be guided in its work by the various international supervisory standards set out by the Basel Committee on Banking Supervision, the IAIS and International Organisation of Securities Commissions (IOSCO).

In addition to closely supervising risk at the authorised firm level, it is essential that risks and trends are tracked and evaluated at the aggregate macro-prudential level. The events of 2008 clearly exposed the vulnerabilities of the financial industry whose business models depended too heavily on access to concentrated funding sources, an over concentration in certain asset classes, and often involved excessively high levels of leverage. Two major factors contribute to the development of the crisis, the weakness in risk management practices at the industry level, and the limited oversight capabilities by regulatory regimes even in the most sophisticated financial markets.

The QFC Regulatory Authority has taken concrete steps to further strengthen its ability to respond to any future systemic or financial contagion risk considerations by supplementing its management team with risk management experts with extensive regulatory and industry experience. In this regard, the Risk function is in the process of facilitating efforts to provide leadership and independent expertise, particularly from a macro-prudential perspective, not only to safeguard stability within the QFC but also for the purpose of championing financial industry risk management best practices across Qatar and in the region. This investment in risk management capabilities is an important addition to the QFC Regulatory Authority’s capabilities which will continue to be strengthened during the years to come.

To read more, check the Application and Regulation Process and Guides.