FSB outlines 2022 priorities
18 February 2022 Switzerland
Image: bakhtiarzein/stock.adobe.com
The Financial Stability Board (FSB) has published a letter detailing the challenges of a post-pandemic environment.
The letter from Chair Klaas Knot to G20 Finance Ministers and Central Bank Governors, notes that the COVID-19 pandemic continues to weigh on the global economy.
The global financial system has been able to support the recovery to date, with support from the G20’s post-2008 crisis reforms and a determined policy response, says Knot.
The letter lays out the FSB’s policy work during 2022 to promote global financial resilience.
This highlights the need to support the financial market’s adjustment to a post-COVID world. A tightening of financial conditions and a greater divergence of these conditions, between advanced and emerging market economies, could pose risks to financial stability.
To combat this, the FSB will report to the G20 in 2022 on policy considerations to support a more sustainable and inclusive global recovery. It will also identify effective financial sector practises for national authorities to consider for addressing the effects of COVID-19 scarring.
To reinforce financial system resilience in light of the COVID experience, the FSB intends to deliver a comprehensive progress report on the various initiatives under its Non-Bank Financial Intermediation (NBFI) work programme to the G20 in October, including on policy proposals to address systemic risk in NBFI.
The FSB also underlines the need to harness the benefits of digitalisation while containing its risks. To achieve this goal, it plans to prepare a progress report on the G20 Cross-Border Payments Roadmap and an assessment of the implementation approach for monitoring progress towards the roadmap’s quantitative targets.
It will also publish a consultative review of its high-level recommendations for the regulation and oversight of “global stablecoin”.
In addressing the financial risks from climate change, the FSB’s roadmap will ensure that sustainability risks are reflected in all financial decisions.
Finally, it aims to publish best practice requirements to guide regulatory cyber incident reporting and will continue to tighten its guidelines relating to third-party risk management and outsourcing.
The FSB will provide a progress report on the roadmap in July and will report in October on the progress in achieving consistent financial disclosures, on use of scenario analysis, and on regulatory and supervisory approaches.
The letter from Chair Klaas Knot to G20 Finance Ministers and Central Bank Governors, notes that the COVID-19 pandemic continues to weigh on the global economy.
The global financial system has been able to support the recovery to date, with support from the G20’s post-2008 crisis reforms and a determined policy response, says Knot.
The letter lays out the FSB’s policy work during 2022 to promote global financial resilience.
This highlights the need to support the financial market’s adjustment to a post-COVID world. A tightening of financial conditions and a greater divergence of these conditions, between advanced and emerging market economies, could pose risks to financial stability.
To combat this, the FSB will report to the G20 in 2022 on policy considerations to support a more sustainable and inclusive global recovery. It will also identify effective financial sector practises for national authorities to consider for addressing the effects of COVID-19 scarring.
To reinforce financial system resilience in light of the COVID experience, the FSB intends to deliver a comprehensive progress report on the various initiatives under its Non-Bank Financial Intermediation (NBFI) work programme to the G20 in October, including on policy proposals to address systemic risk in NBFI.
The FSB also underlines the need to harness the benefits of digitalisation while containing its risks. To achieve this goal, it plans to prepare a progress report on the G20 Cross-Border Payments Roadmap and an assessment of the implementation approach for monitoring progress towards the roadmap’s quantitative targets.
It will also publish a consultative review of its high-level recommendations for the regulation and oversight of “global stablecoin”.
In addressing the financial risks from climate change, the FSB’s roadmap will ensure that sustainability risks are reflected in all financial decisions.
Finally, it aims to publish best practice requirements to guide regulatory cyber incident reporting and will continue to tighten its guidelines relating to third-party risk management and outsourcing.
The FSB will provide a progress report on the roadmap in July and will report in October on the progress in achieving consistent financial disclosures, on use of scenario analysis, and on regulatory and supervisory approaches.
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