LONDON, Oct 14 (Reuters) – The Financial Stability Board, the global watchdog for financial risks, should be more selective in prioritising new work and focus on vulnerabilities that are genuinely cross-border, cross-sectoral and systemic, a review of its processes found.
• The review, the findings of which were published on Wednesday, was commissioned to examine whether the FSB’s approach to developing, drafting and presenting policy has itself created obstacles to implementation.
• It was conducted by the Independent Monitoring Review (IMR) group chaired by Randal Quarles, a former FSB chair and former US Federal Reserve vice chair for supervision and follows a 2025 report that noted a “concerning trend” of delayed or stalled implementation of FSB recommendations.
• The IMR found that national factors, including legal frameworks, market structures and political capacity, were the main reasons why implementation has lagged.
• It said the FSB’s own processes had not always sufficiently accounted for those circumstances, in some cases making implementation more difficult or more contentious than necessary.
• The FSB should default to high-level principles when a vulnerability is still emerging, adding more detailed requirements only as its understanding of the risks develops, the IMR added.
• The FSB’s recent work has included recommendations to improve cross-border payments and for the supervision of global stablecoins. It is also developing non-binding guidance for practices on AI use.
• Also on Wednesday, the FSB proposed eight recommendations that aim to modernise supervision frameworks.
(Reporting by Phoebe SeersEditing by David Goodman)
Comments