De Nederlandsche Bank published a speech by Klaas Knot at a financial stability conference at Banco de España in which, in his final address as Chair of the Financial Stability Board (FSB), he reviewed current financial stability risks and the FSB’s policy agenda. He highlighted non-bank financial intermediation as a recurring amplifier of market stress, argued that agreed reforms only reduce systemic risk once implemented, and cautioned against conflating regulatory simplification with deregulation. The speech pointed to existing FSB policy work on money market fund resilience, structural liquidity mismatch in open-ended funds and liquidity preparedness for margin calls, alongside a stated intention to deliver further policy recommendations to the G20 later in June on leverage-related risks in non-bank finance. Knot also flagged data gaps as a key constraint on monitoring and calibrating policy, noting that an FSB high-level group is exploring ways to close non-bank data gaps. On banking, he cited the Credit Suisse failure and three US regional bank failures as reminders that resolution challenges remain and noted that the final Basel III standards have still not been implemented in many jurisdictions. He also discussed structural shifts from technology, payments and climate risk, including a view that crypto-assets do not yet pose systemic risk but may be nearing a tipping point given the introduction of crypto ETFs and growing links with traditional finance, and noted ongoing work under the G20 Roadmap for Enhancing Cross-Border Payments and the FSB Climate Roadmap amid continued implementation and data challenges. Next steps referenced in the speech include the delivery of FSB policy recommendations to the G20 later in June on non-bank leverage and work to develop a strategy for the next phase of the cross-border payments roadmap.
De Nederlandsche Bank 2025-06-12
De Nederlandsche Bank’s Klaas Knot previews Financial Stability Board recommendations on non-bank leverage and urges full implementation of post-crisis reforms
De Nederlandsche Bank published a speech by Klaas Knot at a financial stability conference, highlighting non-bank financial intermediation as a recurring amplifier of market stress and cautioning against conflating regulatory simplification with deregulation. Knot discussed FSB policy work on money market fund resilience, liquidity mismatches, and leverage-related risks, with recommendations to be delivered to the G20. He also addressed data gaps, resolution challenges, and structural shifts from technology, payments, and climate risk, noting crypto-assets may be nearing a systemic risk tipping point.