The FSB has set a decisive course for 2024, aiming to fortify global financial stability amidst a landscape marked by heightened vulnerabilities.
Today, the FSB unveiled its comprehensive work programme, which zeroes in on pivotal areas and introduces new initiatives, aligning with the priorities of the Brazilian G20 Presidency.
A core component of the FSB’s strategy involves bolstering global cooperation to navigate financial stability in a dynamic environment. The FSB is bracing for elevated global financial system vulnerabilities, stemming from persistent high-interest rates and an uncertain growth trajectory. Simultaneously, the FSB is attentive to emerging vulnerabilities linked to structural shifts, notably in domains such as climate change, cyber threats, and the burgeoning crypto-asset markets.
The FSB is steadfast in its commitment to consummate resolution reforms. This entails advancing the complete implementation of the Key Attributes of Effective Resolution Regimes for Financial Institutions across varied sectors.
The spotlight is on assimilating lessons from the March 2023 banking tumult, with particular focus on deposit behaviour and the influence of technology and social media. Additionally, the FSB will delve into interest rate and liquidity risk within the financial ecosystem. As part of its 2024 agenda, the FSB is poised to finalize its proposals for resources and tools geared towards supporting the resolution of a central counterparty (CCP) and will publish a list of insurers adhering to the resolution planning standards.
Further fortifying the resilience of non-bank financial intermediation (NBFI) remains a pivotal aspect of the FSB’s roadmap. The FSB, in collaboration with standard-setting bodies and international organizations, is set to propel its work programme for augmenting NBFI resilience. This encompasses devising policy recommendations for non-bank financial leverage, enhancing liquidity preparedness of non-bank market participants for margin and collateral calls, and initiating fresh work on the stability and resilience of repo markets.
In the realm of enhancing cross-border payments, the FSB is driving a comprehensive set of actions and a framework for monitoring progress, in line with the G20 roadmap. The agenda for 2024 includes issuing recommendations to foster alignment and interoperability in data frameworks related to cross-border payments and formulating recommendations to bolster the consistency of regulation and supervision of banks and non-banks providing these services.
Digital innovation remains a double-edged sword, offering vast benefits while posing inherent risks. The FSB is channeling its focus into ensuring the effective implementation of the global regulatory and supervisory framework for crypto-asset activities and markets, as well as for global stablecoin arrangements. The year 2024 will witness the FSB finalizing work on the financial stability implications of tokenisation, preparing a G20 report on recent AI developments and their potential financial stability implications, and enhancing cyber resilience through designing a format for incident reporting exchange (FIRE) to harmonize financial institutions’ reporting of incidents to financial authorities.
The FSB is also zeroing in on financial risks emanating from climate change. Coordinating international efforts, the FSB’s roadmap for addressing climate-related financial risks includes analyzing the relevance of transition plans for financial stability. For the G20, it involves a stocktake of regulatory and supervisory initiatives pertinent to the identification and assessment of nature-related financial risks. Furthermore, the FSB is committed to compiling a further progress report on achieving consistent climate-related financial disclosures.
FSB’s work programme for 2024 embodies a strategic, multi-faceted approach to navigating the complexities of the global financial landscape, emphasizing cooperation, resilience, and forward-thinking innovation.
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