The FSB RCG for Americas discussed sovereign risk, regtech, crypto-assets, and work to reduce misconduct risk at its recent meeting in Asuncion, Paraguay. Members of the RCG Americas were updated on FSB's current and planned activities, which range from policy development to implementation and evaluation of reforms.
The following are the key highlights of the discussions:
- Regulatory treatment of sovereign exposures. The discussion involved exchanging views on the ideas in the BCBS discussion paper on the regulatory treatment of sovereign exposures. They discussed the role that sovereign exposures play in the banking system, financial markets, and the broader economy, along with the risks that they may pose.
- Role of fintech and regtech in AML. Members discussed how fintech and regtech can play a role in improving the effective implementation of measures related to anti-money laundering and countering the financing of terrorism (AML/CFT). Money laundering and terrorist financing risks are a concern in certain areas of the FSB’s work, including its action plan to address the decline in correspondent banking relationships and its analysis of the potential financial stability implications of crypto-assets.
- Financial stability implications of crypto-assets. Members exchanged views on regulatory aspects involved with crypto-assets and the role of central banks and financial regulators, given the rapid growth of crypto-asset markets and the growing involvement of retail investors.
- Reduction of misconduct risk. The meeting concluded with a discussion on how to address misconduct in the financial sector. Members discussed the role of governance frameworks, including culture, in a firm and of individual accountability in mitigating misconduct risk. The session drew on the recently published paper of FSB on a toolkit for firms and supervisors for strengthening governance frameworks to mitigate misconduct risk.
Related Link: Press Release
Keywords: International, Banking, Securities, Sovereign Risk, Regtech, Misconduct Risk, Crypto Assets, FSB
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