What was the primary goal of the Financial Stability Board established in 2009?

• A. To improve communication between securities regulators
• B. To ensure financial stability of global financial networks
• C. To create unified financial legislation
• D. To regulate stock exchanges in member countries

Answer: (B)

The primary goal of the Financial Stability Board (FSB), established in 2009, was to ensure the financial stability of global financial networks. This organization was created in the aftermath of the 2007-2008 global financial crisis, which highlighted the need for a coordinated international approach to financial regulation. The FSB focuses on promoting global financial stability by monitoring and making recommendations about the global financial system, ensuring that risks are addressed, and establishing frameworks for effective regulation and supervision.

The emphasis on safeguarding financial stability means that the FSB engages with various sectors of the financial system to identify vulnerabilities and strengthen systemic risk oversight. By prioritizing global financial stability, the FSB aims to mitigate the likelihood of future financial crises, thus protecting economies and consumers worldwide.

The other options, while related to financial regulations, do not capture the fundamental mission of the FSB to maintain financial stability at a global level. Improved communication among regulators, unified legislation, and the regulation of stock exchanges are all important aspects of a well-regulated financial system, but they are not the primary focus of the FSB. The FSB's ultimate goal is to foster a stable and resilient global financial framework that can withstand shocks and maintain investor confidence.