Financial Stability Board launches peer review of public sector backstop funding mechanisms and seeks stakeholder feedback

The Financial Stability Board has published summary terms of reference for a thematic peer review on how member jurisdictions have implemented public sector backstop funding mechanisms. The review focuses on arrangements intended to provide temporary, last resort funding to firms in resolution so an orderly resolution can proceed without severe systemic disruption or taxpayer losses. The exercise will assess progress on implementing Key Attribute 6 of the Key Attributes of Effective Resolution Regimes for Financial Institutions and the guiding principles on temporary funding needed to support the orderly resolution of a global systemically important bank. The FSB has sent a questionnaire to member jurisdictions and is also inviting views from financial institutions, industry and consumer associations, academics and other stakeholders. Feedback is sought on how liquidity-related financial stability vulnerabilities for global systemically important banks and other banks that could be systemic in failure differ across jurisdictions, and on the design, credibility and capabilities of public sector backstops, including safeguards to limit taxpayer losses and moral hazard. Stakeholder feedback is requested by 31 March 2026, and the peer review report is expected in October 2026.