FSB published a letter from the Chair Randal K. Quarles to the G20 finance ministers and Central Bank governors ahead of the meetings in Riyadh on February 22-23. The letter sets out key deliverables during the Saudi Arabian G20 Presidency. The key FSB priorities for 2020 will be related to the London Inter-bank Offered Rate (LIBOR) transition, certain key issues in the technological arena, regulatory issues around stablecoins, improvements in cross-border payments, and work in the area of non-bank financial intermediation, among others.
The letter notes that the global financial system is constantly facing new challenges. Technology is changing the nature of traditional finance; the non-bank sector has grown and requires deeper understanding and coordination among the supervisory and regulatory community. Pressures that can lead to market fragmentation exist. Concurrently, important supervisory and regulatory issues require attention. Against this backdrop, the focus areas for FSB’s work for the Saudi Arabian G20 include the following:
- FSB welcomes the increased G20 focus on the issue of LIBOR transition and will publish reports on this transition in July and December.
- Building on the work published last year, FSB will provide a report on the implications of the provision of financial services by bigtechs for emerging market and developing economies. The G20 Presidency has also asked FSB to submit a report on the range of practices in the use of regtech and suptech.
- FSB is resolved to quicken the pace of developing the necessary regulatory and supervisory responses to these new instruments. It will issue a draft report on regulatory issues and possible responses for public consultation in April.
- Recognizing the importance of efficient and inclusive payment services for global growth, the Saudi G20 Presidency has requested FSB to coordinate the development of a roadmap for improving cross-border payments. FSB will deliver this roadmap to the G20 in October.
- FSB is considering what work is appropriate and whether to reorganize the existing work on non-bank financial intermediation. This is due to the new vulnerabilities that may arise from growth in this sector. Non-bank financial intermediation now accounts for roughly half of the global financial assets.
- In June, FSB will publicly consult on its report on the evaluation of the post-crisis regulatory framework to assess the extent to which too-big-to-fail reforms are reducing the systemic and moral hazard risks associated with systemically important banks. FSB will also deliver its annual report on the progress in implementation of these reforms ahead of the G20 Summit.
Keywords: International, Middle East and Africa, Saudi Arabia, Banking, Bigtech, Suptech, Regtech, Stablecoins, G20, Benchmark Reforms, Regtech, Cyber Risk, Too Big to Fail, FSB
HKMA announced that enhancements will be made to the Special 100% Loan Guarantee of the SME Financing Guarantee Scheme (SFGS) and the application period will be extended to December 31, 2021.
EBA launched consultations on the regulatory and implementing technical standards on cooperation and information exchange between competent authorities involved in prudential supervision of investment firms.
BoE has set out a three-phased plan to transform data collection from the UK financial sector over the next decade.
BIS recently made a couple of announcements with respect to the planned and ongoing work in the area of financial technology.
ESRB updated the list of national macro-prudential measures applied by each member state in the European Economic Area.
BoE has set out results of a survey on the impact of COVID-19 events on the use of machine learning and data science.
In response to a request from the European Council and Parliament, ECB published an opinion on the proposed regulation on markets in crypto-assets.
APRA announced the updated aggregate amounts for the 2021 Committed Liquidity Facility (CLF) established between the Reserve Bank of Australia (RBA) and certain locally incorporated authorized deposit-taking institutions that are subject to the Liquidity Coverage Ratio (LCR).
ECB published supervisory Memorandums of Understanding (MoUs) with UK as well as other European and non-European authorities.
EIOPA identified business model sustainability and adequate product design as the two EU-wide strategic supervisory priorities.