Financial Stability Board Meeting to Discuss Ongoing 2017-2018 Workplan

The Financial Stability Board has published a press release summarizing the outcome of its plenary meeting in Berlin on October 6, 2017, at which it considered potential vulnerabilities in the financial system and discussed a number of areas from its workplan. The discussion included the following:

a. Evaluation of the effects of the G20 financial regulatory reforms on financial intermediation. This will include, firstly, examination of trends in, and evaluation of the effects of financial regulatory reforms on, the financing of infrastructure investment. Secondly, the FSB will examine intermediation trends by broad financing source, including bank financing and market-based financing, across types of borrowers and across countries and evaluate the effect of reforms on resilient financial intermediation.

b. Central clearing of OTC derivatives. The FSB began a review of the incentives for central clearing of OTC derivatives in July 2017 and expects that review to conclude in late 2018. The FSB will launch a public consultation as part of this review in mid-2018.

c. Global systemically important financial institutions. The FSB members discussed progress of the annual reviews of the lists of global systemically important banks and global systemically important insurers, conducted in consultation with the Basel Committee on Banking Supervision and the International Association of Insurance Supervisors. This discussion included updates on the work of the Basel Committee and the IAIS to assess any cross-sectoral inconsistencies in the assessment methodologies and on the implementation of the third phase of G-SIB data collection.

d. Cyber-security. The FSB members reviewed the results of a stock-take of existing publicly available regulations, supervisory practices existing international guidance that relates to cyber-security in the financial sector. The stock-take will be presented to the meeting of G20 Finance Ministers and Central Bank Governors to be held on October 12-13, 2017 and will subsequently be published.

e. Misconduct risks. The FSB discussed progress on reforms to major interest rate benchmarks and approved for publication a progress report from the FSB’s Official Sector Steering Group set up to coordinate these reforms. There was also discussion of developments in correspondent banking and remittances. The FSB also discussed the development and planned publication in April 2018 of a toolkit on strengthening governance frameworks to mitigate misconduct risks.

f. Market-based finance. The FSB approved the operational arrangements for the collection and aggregation of data on global securities financing transactions, beginning with end-2018 data. The FSB proposes to publish detailed reporting guidelines later in 2017. The FSB also received updates on the annual global shadow banking monitoring exercise, the results of which will be published by the end of 2017, and on how the International Organization of Securities Commissions is putting into effect relevant FSB policy recommendations to address structural vulnerabilities from asset management activities.

View the press release.