FSB Chair’s letter to G20 Finance Ministers and Central Bank Governors: February 2023
Economic history reminds us that the combination of near-record high levels of public and private sector debt, rising debt service costs and stretched asset valuations in some key markets can pose serious threats to financial stability.
This letter was submitted to G20 Finance Ministers and Central Bank Governors (FMCBG) ahead of the G20’s meeting on 24-25 February.
The financial stability outlook remains challenging. While expectations of a ‘soft landing’ for the global economy have grown, the outlook remains clouded by uncertainty. The combination of near record-high levels of debt, rising debt service costs and stretched asset valuations in some key markets can pose serious threats to financial stability. The letter lays out the FSB’s work during 2023 to monitor and address these conjunctural vulnerabilities, as well as a number of structural vulnerabilities.
The letter introduces the reports the FSB is delivering to the February G20 FMCBG meeting, which cover:
The financial stability aspects of commodity markets, which forms part of the FSB’s work programme to strengthen the resilience of the NBFI sector.
The financial stability risks of decentralised finance (DeFi), a fast-growing segment of the crypto-asset ecosystem. The report forms part of the FSB’s work programme, jointly with sectoral standard setters, for the delivery of a consistent and comprehensive regulatory framework for crypto-assets.
Priority actions for achieving the G20 targets for enhancing cross-border payments. The report contains a detailed set of next steps to achieve the G20 cross-border payments roadmap’s goals and is being accompanied by the establishment of two new taskforces to work in partnership with the private sector.
The letter also outlines forthcoming work to enhance cyber and operational resilience; and to address climate-related financial risks, through the FSB’s climate roadmap.
FSB reports to the G20 during the 2023 Indian Presidency
|February||Financial stability aspects of commodities markets|
|Financial stability implications of decentralised finance (DeFi)|
|Updated set of prioritised actions under Cross-border Payments Roadmap|
|April||Achieving convergence in cyber incident reporting – finalised report and format for incident reporting exchange (FIRE) report|
|July||Regulatory and supervisory approaches to crypto-assets and markets - finalised recommendations|
|Regulatory and supervisory approaches to global stablecoin arrangements - finalised recommendations|
|Third-party risks and outsourcing – consultation paper|
|Annual progress report on FSB Roadmap for Addressing Financial Risks from Climate Change|
|Revised FSB Recommendations to address liquidity mismatch in open-ended funds – consultation paper|
|September||FSB-IMF synthesis note on macroeconomic and regulatory perspectives on crypto-assets|
|Financial stability implications of leverage in the non-bank sector|
|Enhancing the resilience of NBFI: progress report|
|October||Promoting Global Financial Stability: 2023 FSB Annual Report|
|Annual progress report on climate-related disclosures|
|Annual progress report on Cross-border Payments Roadmap|