GHOS Endorses Strategic Priorities and Work Program of BCBS
The Group of Central Bank Governors and Heads of Supervision (GHOS), which is the oversight body of BCBS, has endorsed the strategic priorities and work program of the Basel Committee for 2021–22. Consistent with the previous GHOS agreement, dated November 2020, to mark a clear end to the Basel III policy agenda, the new work program places high priority on the implementation and evaluation of previously agreed reforms, on assessing emerging risks and vulnerabilities, and increasing supervisory cooperation. The detailed work program will be published in April 2021.
BCBS will also keep monitoring the resilience of the global banking system as the COVID-19 pandemic continues to unfold, ensuring that banks contribute to the subsequent recovery sustainably. During the recent meeting, GHOS members also took the opportunity to exchange views on various ongoing global initiatives on non-bank financial intermediation (NBFI). NBFI now accounts for almost half of the global financial system and plays an increasing role in providing financing to the real economy. Banks and non-bank financial entities are interconnected through multiple channels. The safety and soundness of the NBFI sector is, therefore, important to the safety and soundness of the banking sector. GHOS members agreed that NBFI initiatives should take a holistic approach, as followed by FSB, considering the need to improve the resilience of NBFI, to minimize systemic risk and to meet other market-related objectives. Such initiatives should also safeguard the resilience and agreed prudential standards of the global banking system, which have been a critical support in the management of the COVID-19 crisis. Meanwhile, bank supervisors should continue to monitor NBFI developments to better gauge the range of direct and indirect interconnections with the banking system.
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Keywords: International, Banking, Basel, COVID-19, Work Program, Strategic Priorities, NBFI, GHOS, BCBS
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