IASB offers olive branch to banks

Link: Banks set for last ditch talks with IASB

The global body is set to release a paper with options for changes to proposed rules for derivatives, seen as a key step to establishing a set of comprehensive accounting standards for the European Union to be adopted by 2005.

But Sir David Tweedie, head of the IASB, wants to ensure that any compromise does not undermine the core principles of the standards.

Yesterday, following a six hour-meeting, Robert Garnett, the IASB member who chaired the discussions with the banks, said he was hopeful of finding a solution, the FT reported.

‘We would not be planning to meet again if we were poles apart,’ Garnett added.

The key issue is the IASB’s alternative reporting regime for derivatives – such financial instruments are widely used by banks in their risk management strategies.

The concern from the banks is that the changes will have an impact on interest rates.

Further discussions have been scheduled between the IASB and the banks, while the draft changes will be considered by IASB members, before possible approval.

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