Banks to propose reforms given credit crisis

By Christian Plumb

RIO DE JANEIRO (Reuters) - The top international banking lobby is drawing up an industry response to the credit crisis that will urge stronger risk management and accounting standards, Deutsche Bank (DBKGn.DE) Chairman Josef Ackermann said on Thursday.

The lobby, called the Institute of International Finance, is trying to influence regulators' response to the banking industry's current woes and find ways to forestall future crises.

An interim report containing the reform proposals, which are being negotiated with the IIF's roughly 380 members, will likely be issued in two to four weeks, said Ackermann, who in addition to heading up Deutsche Bank is also IIF chairman.

The IIF acknowledged that an industry response to the subprime crisis was needed at its last meeting in October and designated a committee to come up with recommendations.

"It is important that risk management be at the core of overall corporate culture to enable firms to better withstand the kinds of market stress that we are currently experiencing," Ackermann said at a news conference.

Steps to bolster compensation disclosure are also under discussion, he said.

"We have to be more pronounced about the methodology" used in setting compensation, he said, emphasizing the lobby group won't try to directly influence how much bankers are paid.

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