By Park Hyong-ki Staff Reporter Financial Supervisory Commission Chairman Kim Yong-duk warned of growing risks stemming from excess global liquidity and called on international regulators to join hands to tackle credit woes. Speaking at a forum jointly hosted by the Financial Stability Institute (FSI) and the Executive Meeting of East Asia-Pacific Central Banks (EMEAP) in Sydney, Australia, Tuesday, the chairman suggested creating more cross-border regulatory channels to address and resolve emerging issues affecting the Asia-Pacific region. ``We will need to look at these both from the domestic and cross-border perspective. The resulting situation has led to much speculation as to how much deeper the losses may be,'' said Kim. The FSI is one of the units under the wing of the Bank for International Settlements. EMEAP is an organization of Asian central banks and monetary authorities. Risks and defaults surrounding asset-backed securities and collateralized debt obligations, hit by subprime lending, have called for greater attention on banks lending from central bankers as well as supervisors, said Kim. This has given a wake up call to regional authorities to strengthen their governing of financial firms' soundness and efficient risk management, and further prevent them from herd behavior of ``reckless lending,'' so the Basel II capital adequacy accord can be stably implemented. ``Along with micro-prudential regulation focusing on the soundness of individual institutions, a macro-prudential approach is important to prevent system-wide risk arising from excessive risk-taking in a herd behavior pattern,'' said Kim. He asked central bankers and regulators to join hands in keeping excess liquidity in Asia under control and managed. Without such joint efforts, he said it is highly likely to ``create asset bubbles and distort credit allocation,'' while troubling financial firms in boosting Asian economies. phk@koreatimes.co.kr