Financial Stability Board Chair calls on G20 to close reform implementation gaps and step up monitoring of private credit and stablecoins

The Financial Stability Board published a letter from its Chair, Andrew Bailey, to G20 Leaders ahead of the Johannesburg summit, urging global efforts to modernise and strengthen financial regulation without compromising stability. The letter points to significant gaps in the implementation of financial reforms and highlights the growing role of nonbank finance and new payment forms as priorities for authorities. An interim report of the FSB’s Implementation Monitoring Review identified significant shortcomings in reform implementation, with further work planned to examine where implementation was not achieved. The letter highlights the increasing role of nonbank financial intermediaries in global markets, particularly government bond markets and private credit, with private credit estimated at around USD 2 trillion globally, and sets out that the FSB will monitor the sector and assess implications for system resilience. It also calls for faster progress on the G20 Roadmap for Enhancing Cross-Border Payments, including sustained attention to national policy barriers, and urges robust, consistent frameworks for stablecoins as their use in payments increases, including consideration of safe cross-border operation. The next phase of the FSB’s implementation monitoring work will look more deeply into areas where reforms were not implemented, and the FSB’s work programme for the year ahead will include a focus on stablecoins and other forms of payment.