Transforming Shadow Banking into Resilient Market-based Finance: An Overview of Progress
In response to the G20 Leaders’ request at the Seoul Summit in 2010 and subsequently, the FSB has adopted a two-pronged strategy to address the financial stability risks in shadow banking and transform it into resilient market-based finance. First, the FSB has created a system-wide monitoring framework to track developments in the shadow banking system with a view to identifying the build-up of systemic risks and initiating corrective actions where necessary. Second, the FSB has been coordinating and contributing to the development of policies to strengthen oversight and regulation of shadow banking.
This report sets out progress on actions taken to implement the FSB’s two-pronged strategy to address financial stability concerns associated with shadow banking over the past year, and the next steps in this work. There has been further progress this year to strengthen oversight and regulation of shadow banking, particularly in the area of securities financing. The implementation of previously agreed policies is progressing. It is essential for the agreed policies to be implemented in a timely manner, and the FSB, in coordination with relevant standard-setting bodies, will continue to monitor the national implementation of agreed policies to ensure they achieve the intended objectives.