The Independent Evaluation Office (IEO) of the International Monetary Fund (IMF) has released is latest Evaluation of the FSAP, a program established in 1999 to provide advice to strengthen the financial systems of member countries by facilitating early detection of financial sector vulnerabilities and helping to identify financial sector development needs.
Although a voluntary program, the FSAP has become the principal platform for financial sector diagnosis at the IMF. It is a joint IMF-World Bank exercise (except in industrial countries), but with different outputs for different purposes, including a confidential report to the authorities and separate summary reports to the Boards of the IMF (the Financial System Stability Assessment or FSSA) and the World Bank (Financial Sector Assessment or FSA).
**Key Findings and Recommendations**
The evaluation’s major findings and related recommendations *(see link below)*are focused on three key themes:
• enhancing incentives for participation, clarifying priorities, and strengthening the links with surveillance;
• steps to strengthen further the quality of the FSAP and organizational changes within the IMF; and
• the working of the joint IMF-World Bank approach.
The Independent Evaluation Office operates independently of IMF management and at arm’s length from the IMF’s Executive Board.
*Note: The IMF concluded an Article IV Consultation of The Bahamas in June 2005, and prior to that an Assessment of the Supervision and Regulation of the Financial Sector in October 2004. Its second Module II Assessment of The Bahamas is scheduled during 2006.*