FSB Chair Calls for Full Implementation of Global Financial Reforms
"[T]he FSB will enhance its surveillance of vulnerabilities in the financial system, while shifting its focus from policy development to monitoring and facilitating the implementation of agreed reforms. This pivot underscores the importance of translating jurisdictions’ commitments into concrete actions."
Andrew Bailey, Financial Stability Board Chair
"[T]he FSB will enhance its surveillance of vulnerabilities in the financial system, while shifting its focus from policy development to monitoring and facilitating the implementation of agreed reforms. This pivot underscores the importance of translating jurisdictions’ commitments into concrete actions."
Andrew Bailey, Financial Stability Board Chair
Financial Stability Board ("FSB") Chair Andrew Bailey warned international finance ministers and central bank governors that incomplete and uneven implementation of global financial reforms undermines resilience and leaves the financial system exposed to future shocks.
In a letter to G20 finance ministers and central bank governors, Mr. Bailey said the upcoming G20 meeting comes at a time of heightened global risks and continued market vulnerabilities. He urged stronger multilateral cooperation. He highlighted several areas of concern:
- Implementation of Reforms. Mr. Bailey cautioned that "full, timely and consistent implementation" of agreed upon financial reforms has not been achieved, pointing to the incomplete adoption of the Basel III framework. He said the FSB is strengthening its monitoring and peer review processes.
- Cross-Border Payments. Mr. Bailey noted that progress under the G20’s Cross-Border Payments Roadmap remains behind schedule, with global improvements in cost, speed, and transparency unlikely to meet the 2027 targets. He urged jurisdictions to redouble implementation efforts and called for greater private-sector engagement to deliver meaningful results for end users.
- Crypto-Assets. Mr. Bailey said the FSB’s thematic peer review found progress in applying the FSB’s crypto-asset framework but identified persistent gaps in addressing financial stability risks. He warned that uneven implementation creates opportunities for regulatory arbitrage, particularly given that few jurisdictions have finalized stablecoin regulatory frameworks.
- Emerging Risks. Mr. Bailey said the FSB is enhancing its surveillance capabilities to better identify and respond to evolving risks, including the growth of private finance, the implications of geopolitical fragmentation, and the expanding role of artificial intelligence ("AI") in financial markets. He noted that AI adoption, while fostering innovation, also introduces vulnerabilities tied to third-party dependencies, cyber threats, and model governance. He said the FSB is developing indicators to monitor AI-related risks and promote safe innovation.