FSB Summarizes Progress in Implementation of G20 Regulatory Reforms
FSB published a summary progress report on implementation of the G20 financial regulatory reforms. The report has been delivered to the G20 Leaders, ahead of the Summit in Osaka from June 28-29, 2019. The report finds that the new financial regulatory framework, which the G20 had called for, is now largely in place. The report includes a table showing the implementation status (as of June 2019) across FSB jurisdictions for core reform areas, including changes since the November 2018 G20 Summit.
The report highlights that these reforms make the financial system more resilient and reduce the likelihood and severity—and associated public cost—of future financial crises. However, despite continued progress, implementation is not complete and remains uneven across reform areas. The challenges in meeting the agreed dates relate to domestic legislative or rule-making processes; concerns over the pace of implementation in other jurisdictions; and difficulties faced by regulated entities in adjusting to the new requirements. It is critical to maintain momentum and avoid complacency, to achieve the goal of greater resilience. The report calls for the continued support of G20 Leaders in implementing the agreed reforms. Implementation progress across the four core reform areas is as follows:
- Building resilient financial institutions—The report highlights that regulatory adoption of core Basel III elements has generally been timely, though implementation of some standards is behind schedule.
- Ending too-big-to-fail—The report mentions that implementation of policy framework has advanced the most for global systemically important banks (G-SIBs). However, substantial work remains in achieving effective resolution regimes and operationalizing plans for systemically important banks and non-bank financial institutions.
- Making derivatives markets safer—Overall, good progress has been made to date across over-the-counter (OTC) derivatives market reforms, though only one jurisdiction has reported further implementation progress since 2018.
- Enhancing resilience of non-bank financial intermediation (NBFI)—Implementation of reforms to strengthen oversight and regulation of NBFI remains at an earlier stage when compared to the other areas, partly reflecting the later implementation deadlines.
FSB continues to evaluate the effects of reforms and will identify and deliver adjustments, where appropriate, without compromising on financial resilience. The next full progress report on implementation and effects of reforms will be delivered to the G20 and published in October 2019.
Related Links
Keywords: International, Banking, Securities, Basel III, G-SIBs, G20, Progress Report, Too Big to Fail, NBFI, OTC Derivatives, FSB
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
BCBS Updates Basel III Monitoring Workbook in September 2019Related Articles
PRA and FPC Finalize Changes to Leverage Ratio Framework in UK
The Prudential Regulation Authority (PRA) published the final policy statement PS21/21 on the leverage ratio framework in the UK. PS21/21, which sets out the final policy of both the Financial Policy Committee (FPC) and PRA
CFPB Proposes Rule on Small Business Lending Data Collection
The Consumer Financial Protection Bureau (CFPB) proposed to amend Regulation B to implement changes to the Equal Credit Opportunity Act (ECOA) under Section 1071 of the Dodd-Frank Act.
PRA Decides to Maintain O-SII Buffers for Another Year
The Prudential Regulation Authority (PRA) decided to maintain, at the 2019 levels, the buffer rates for the Other Systemically Important Institutions (O-SII) for another year, with no new rates to be set until December 2023.
FSB Report Assesses Implementation of Recommendations on Stablecoins
The Financial Stability Board (FSB) published a progress report on implementation of its high-level recommendations for the regulation, supervision, and oversight of global stablecoin arrangements.
APRA Updates Loan Serviceability Expectations for Home Lending
In a letter to the authorized deposit taking institutions, the Australian Prudential Regulation Authority (APRA) announced an increase in the minimum interest rate buffer it expects banks to use when assessing the serviceability of home loan applications.
CPMI and IOSCO Consult on Guidance on Stablecoin Arrangements
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) are consulting on the preliminary guidance that clarifies that stablecoin arrangements should observe international standards for payment, clearing, and settlement systems.
EBA and EIOPA Set Out Work Priorities for 2022
The European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA) have set out their respective work priorities for 2022.
MFSA Issues Reporting Updates and Guidance for Banks
The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0, in addition to the reporting module on leverage under the common reporting (COREP) framework.
EC Publishes Decision on List of Equivalent Third Countries Under CRR
The European Commission (EC) published the Implementing Decision 2021/1753 on the equivalence of supervisory and regulatory requirements of certain third countries and territories for the purposes of the treatment of exposures, in accordance with the Capital Requirements Regulation or CRR (575/2013).
EC Rule on Contractual Recognition of Write-Down and Conversion Powers
EC published the Implementing Regulation 2021/1751, which lays down implementing technical standards on uniform formats and templates for notification of determination of the impracticability of including contractual recognition of write-down and conversion powers.
