Strengthening the crisis-preparedness community in an interconnected world

29 October 2026

1. Introduction

Good afternoon, ladies and gentlemen.

It is a pleasure to be here in Berlin and to join you for the closing reflections of this conference.

Today, we have looked at how digitalisation is changing financial services and what this means for deposit insurers, resolution authorities and the wider financial safety net. The changes are happening quickly. New technologies and business models are changing how people hold and transfer money, while new players are becoming part of an already highly interconnected financial system.

For those of us responsible for crisis preparedness, this presents a real challenge. We need to keep pace with these developments without losing sight of the risks we have been dealing with for years. The financial crisis taught us important lessons and led to stronger frameworks, but the environment in which they operate continues to change.

The question is not whether we can anticipate every future crisis.

We cannot.

It is whether our frameworks, institutions and cooperation arrangements are ready for a more interconnected and less predictable world.

I would like to use these final remarks to draw together some of the themes discussed during the conference and consider what they mean for the policy agenda ahead.

2. A new, riskier environment

The financial crisis of 2008 fundamentally changed how we think about financial stability. We strengthened supervision, developed new resolution regimes and reinforced deposit insurance. Together, these efforts have made the financial system better equipped to deal with crises.

But the world in which these arrangements must operate is changing rapidly. We are no longer dealing simply with incremental change. In some areas, change is radical.

Digital technology is transforming financial services, creating new business models and bringing entirely new actors into the market. Stablecoins, for instance, challenge established assumptions about how money is held and transferred, and about where financial intermediation takes place.

The pace is striking. Think of artificial intelligence: in just a few years, it has moved from a relatively specialised field to a global phenomenon, reshaping business models and raising fundamental questions about cybersecurity and financial stability. Developments that begin as experiments can become global concerns within a year or two — sometimes faster.

Innovation is welcome, clearly! But it also raises questions about where risks arise, how they spread, and whether our frameworks remain fit for purpose.

Technology is changing the risks, too. Digital banking allows deposits to move at extraordinary speed. Cyber threats are growing, while our reliance on common technology providers creates new points of vulnerability. The global IT outage caused by a faulty CrowdStrike update in July 2024 showed how a disruption at a single provider can affect services across countries.

More recently, last week’s Revolut outage offers another illustration: on 20 October, a disruption linked to a Google Cloud failure in London affected Revolut’s app, card payments, transfers and cash withdrawals, alongside services at several other financial institutions, highlighting how an incident at a shared technology provider can disrupt critical financial services across multiple firms.

And these developments unfold against a backdrop of geopolitical tensions and growing physical risks. Disruptions to energy, communications or other critical infrastructure can have consequences far beyond the sector in which they originate.

Nor are the risks exclusively new or technological. Traditional financial vulnerabilities are also becoming more acute. High levels of public debt, excessive leverage and growing financing needs are putting pressure on financial markets. Bond- and equity markets volatility and the risk of abrupt repricing could expose liquidity vulnerabilities and amplify stress across the financial system.

These developments remind us that we must remain alert to familiar financial risks even as we prepare for new ones.

The real challenge is that these risks do not operate in isolation. They interact, amplify one another and can spread across institutions, markets and sectors. New risks do not make old ones disappear; they change how familiar vulnerabilities may develop into a crisis.

The challenge is therefore twofold: to keep pace with a changing financial system, while ensuring that we remain prepared for the risks we already know.

Let’s then explore this new environment through three questions: are we looking at the right perimeter? Are we focusing on the right risks? And are our tools and arrangements fit for this new world?

3. Are we looking at the right perimeter?

Over the years, we built a moat around banks. They gained in resilience, but risk has not just vanished. It has migrated to other corners of the financial system.

The question is whether the perimeter of our moat is still fit for purpose.

Here, the resolution framework has an important strength: it focuses our attention on critical functions and services, and the systemic firms that provide them.

Identifying these functions and firms provides a useful methodological tool for the wider financial safety net.

We need to keep scanning the financial system, outside of the banking system, as a whole, asking ourselves if we can identify more critical functions and services and the firms or arrangements on which they depend — including beyond banking.

Very simply, we need to ask ourselves. Will the demise of the interruption of this service have a knock-on effect that can eventually destabilise financial stability?

Indeed, resolution regimes already extend to other important parts of the financial system, including central counterparties and insurers. But we cannot stop there. New players and new arrangements continue to emerge, and the time it takes for an activity to become significant can be remarkably short.

The question of what is a deposit? is a perfect illustration of this challenge from deposit insurance standpoint. Stablecoins, tokenised deposits, deposit-placement platforms and sweep arrangements are changing how money is held, transferred and intermediated. They invite us to look beyond familiar labels and ask what the underlying claim is, who stands behind it, and what protection is available if something goes wrong.

IADI deserves credit for the agility with which it is examining these questions. Its work on digitalisation looks at how new products and intermediaries may affect the boundaries of deposit insurance, as well as public awareness, depositor behaviour and the operational resilience of deposit insurers.1

The Financial Stability Board (FSB) has also contributed through its recommendations on global stablecoin arrangements, including the need for appropriate recovery and resolution plans.

These challenges underline the importance of coordination across the crisis-preparedness continuum — a point I will return to.

Stablecoins are just one example. The broader lesson is that we must not take the current perimeter of our attention for granted. We should use the methodological tools at our disposal to identify whether we may be overlooking a critical service or player.

Moving on to my next question.

4. Are we focusing on the right risks?

The challenge is not simply that new risks are emerging. It is that risks increasingly interact, amplify one another and spread across institutions, markets and sectors in ways that are difficult to anticipate.

Traditional financial risks have not disappeared. Market volatility, excessive debt, liquidity pressures and solvency concerns remain important sources of vulnerability. These risks are particularly acute at the moment.

The environment in which they can materialise has also become more

challenging. Financial institutions are interconnected, markets can reprice rapidly, and stress can spread through channels that may not be immediately apparent.

Recent episodes have illustrated how vulnerabilities outside the banking sector can transmit stress across the financial system. The market turmoil of March 2020, the failure of Archegos in 2021 and the dislocation in the UK gilt market in September 2022 showed how leverage, liquidity mismatches and pressures in non-bank financial intermediation can have wider consequences. Risks do not necessarily emerge where we expect them, or remain confined to the institutions in which they first appear.

But are we looking at the right risks if we focus only on financial vulnerabilities? I would argue that we must also give greater attention to operational incidents.

Round-the-clock payments, frontier AI models and growing reliance on common technology providers can increase the speed and scale at which an incident affects the financial system. A severe cyberattack or technology outage may threaten not only an individual bank, but also a third-party provider on which several institutions depend for critical services. The consequences may extend beyond the institutions directly affected, disrupting services and raising market integrity and financial stability concerns simultaneously.

This brings me to an important distinction. Preparing for these incidents cannot be primarily about prevention. Prevention remains essential, but we must also start from the assumption that, at some point, it will fail. What happens if a cyberattack succeeds in taking a bank offline, or interrupts a critical service on which several institutions rely? How do we maintain or restore that service? How do authorities act when the systems and information they depend on are themselves compromised?

These are not hypothetical questions for crisis management. Consider a severe ICT incident that compromises the reliability of a bank’s data. If the bank is experiencing significant liquidity outflows but its liquidity position cannot be established with confidence, authorities may face difficult decisions about whether the bank is failing or likely to fail, and what action is required. Waiting for reliable data may allow its financial position and franchise value to deteriorate further. Acting on incomplete information also carries risks.

The challenge, therefore, is to understand how operational incidents can translate into financial instability, how their effects may spread, and how authorities can respond when prevention and containment are no longer sufficient. This requires us to connect vulnerability assessments and supervisory intelligence more closely with crisis preparedness, identifying where remedial or containment measures may limit wider spillovers while also preparing for the possibility that disruption cannot be contained.

This is a key concern in the work of the Resolution Steering Group. We need to consider how severe operational incidents could affect the execution of resolution strategies, and how authorities can remain able to take timely decisions and coordinate effectively under difficult conditions. The focus must be on practical readiness, not simply on the existence of preventive safeguards.

So, are we looking at the right risks? Yes, provided that our understanding of risk includes not only the likelihood of a shock, but also our ability to manage its consequences. Alongside traditional financial vulnerabilities, operational incidents must be part of our crisis-preparedness agenda. And that means preparing not only to prevent disruption, but also to maintain or restore critical functions when disruption occurs.

This brings us to the next question: are our tools and arrangements fit for this new world?

5. Are our tools and arrangements fit for this new world?

The Key Attributes provide a strong international standard for resolving failing financial institutions while preserving their critical functions and limiting reliance on public funds.

The problem is that yet they are not fully implemented.

Thus, for ensuring that our tools are fit-for-purpose, the first priority is implementing the framework we have. The FSB’s recent report on public sector backstop funding is a timely reminder of the work that remains. Only four of the 19 jurisdictions assessed were found fully compliant overall with Key Attribute 6 on funding in resolution.

The EU Banking Union, for instance, was not among them.2

This matters because resolution is not only about allocating losses and recapitalising a bank. It is also about ensuring that the bank has sufficient liquidity to continue operating while confidence is restored. A resolution strategy can be sound on paper, but difficult to execute if the bank cannot meet its payment obligations or markets doubt that it can do so.

The events of March 2023 brought this challenge into sharp focus.

Liquidity backstops remain a common challenge for resolution authorities and deposit guarantee schemes alike. We need credible arrangements that can provide liquidity at the necessary scale and speed, with clear responsibilities, appropriate safeguards and a realistic plan for recovering any losses.

In Europe, the Commission’s recent work on the competitiveness of the banking sector has opened a discussion on how to strengthen liquidity in resolution and deposit protection across the Banking Union.3

Interestingly, the same report also hints at the fact that the Single Resolution Fund could take on a deposit insurance role for the largest banks and provide liquidity support to national deposit guarantee schemes (DGS).

DGS and resolution authorities would be even more entangled within the continuum of the crisis management framework.

I do believe that a more integrated arrangement could strengthen the link between resolution and deposit protection, but its design will matter. Responsibilities, safeguards and the relationship between funding arrangements must be clear.

This leads me to the second priority: work better together. Make the frameworks work together. We need to strengthen cooperation across the crisis-preparedness community.

Crisis management does not begin when a bank fails, nor does it end with a resolution decision. It spans prevention, early intervention, recovery, resolution and the restoration of confidence. Preparedness therefore requires cooperation across this continuum, as well as across borders.

The revised IADI Core Principles recognise this clearly. Principle 17 addresses cooperation and coordination among safety-net participants, while Principle 18 focuses on cross-border cooperation and information sharing. This is something we have very clear in mind at the FSB with the Crisis Preparedness Strategic Review. Roundtables that bring the right people together are essential to keeping policy current and ensuring that we learn from one another. And I cannot help noticing that the panel immediately following this speech does exactly that: bringing the relevant perspectives into the same conversation.

At the international level, we need to understand not only where risks are building, but how they might spread, which institutions and services could be affected, and what coordinated action may be needed. This also means making the best use of the work of different standard-setting bodies, while avoiding duplication.

IADI’s own forward agenda captures this spirit. It recognises that digital innovation crosses borders and can blur the boundaries between banking and the wider financial system, meaning that deposit insurers cannot address these challenges in isolation. IADI therefore commits to strengthening collaboration with other international standard-setters and stakeholders.4 The same logic applies to crisis preparedness more broadly: no single authority or standard-setter can fully understand or manage risks that cut across mandates and sectors.

At the SRB, strengthening cooperation has been one of my priorities, both within the Single Resolution Mechanism (SRM) and between the SRM and the Single Supervisory Mechanism. For instance, following the agreement on the Crisis Management and Deposit Insurance reform (CMDI), we immediately reached out to our colleagues in the European deposit guarantee community to build closer working relationships.

The objective is practical: to ensure that our respective arrangements fit together and that we can act in a coordinated way when a crisis unfolds. The same commitment applies internationally, where cross-border banking groups require authorities to prepare together, exchange information and understand how their actions may affect one another.

The third priority is to keep our framework up to date. Given the global nature of these threats, closing gaps requires faster, more coordinated international policy development and exchange of experience.

The FSB’s Crisis Preparedness Strategic Review recognises this need, highlighting the importance of connecting vulnerability assessments more closely with crisis preparedness and bringing the relevant authorities and standard-setting bodies together.5

As SRB Chair, I rely on the FSB’s analysis and conclusions to identify gaps and draw lessons from practices across jurisdictions.

So do my counterparts.

Sharing analyses, standards and best practices is an invaluable input to keeping our toolkit fit for purpose.

This is why, at a recent meeting of the Resolution Steering Group,

we brought these issues to the table, exchanging experience on stablecoin crisis management and responses to operational incidents.

6. Conclusion

The challenges facing the financial safety net are becoming more complex. Risks are evolving, new actors are emerging, and shocks can spread across institutions and sectors with remarkable speed. But the answer is not to discard the frameworks we have built.

We need to keep the perimeter under review, understand how risks interact, implement the standards we already have, and strengthen cooperation across the crisis-preparedness community. We must also be prepared for the moments when prevention fails — when critical functions are threatened and authorities need to act under pressure and uncertainty.

No institution can deliver this alone. Deposit insurers, resolution authorities, supervisors, central banks and international standard-setters each have a role to play. Our task is to make sure that these roles reinforce one another, and that our collective arrangements remain credible when they are needed most.

Ultimately, resilience is not just about preventing crises. It is about ensuring that, when a crisis comes, we are ready to respond together.

  1. IADI (2026), Digitalisation and Deposit Insurance: IADI Preliminary Views and Forward Agenda, July. ↩︎
  2. FSB (2026), Thematic Review on Public Sector Backstop Funding Mechanisms: Peer review report, October. ↩︎
  3. European Commission (2026), Competitiveness of the Banking Sector and the Single Market in Banking. ↩︎
  4. IADI (2026). ↩︎
  5. FSB (2026), Strategic Review of FSB Crisis Preparedness Activities, February. ↩︎

FSB Regional Consultative Group for Sub-Saharan Africa meets in Maseru

24 October 2026

The Financial Stability Board (FSB) Regional Consultative Group for Sub-Saharan Africa (RCG SSA) met on 23–24 October 2026 in Maseru, Lesotho, hosted by the Central Bank of Lesotho. The meeting brought together senior officials from central banks, financial authorities and regulatory bodies in the region to discuss key financial stability topics.

Co-chaired by Lesetja Kganyago, Governor of the South African Reserve Bank, and Denny Kalyalya, Governor of the Bank of Zambia, the meeting covered a range of issues, including:

  • Global and regional financial vulnerabilities, including the transmission of global policy uncertainty and economic fragmentation to the region.
  • Regulatory and supervisory modernisation and the applicability of the FSB’s proposed principles in the Sub-Saharan African context.
  • Climate-related data gaps and insurance protection gaps.
  • The cybersecurity and financial stability implications of artificial intelligence and quantum computing.
  • Regional priorities in view of the FSB’s 2027 work programme.

Members also discussed cross-RCG coordination and key messages from the Sub-Saharan Africa region to the FSB Plenary.

Innovation and resilience: managing the risks of a changing financial system

21 October 2026

Keynote speech by John Schindler, FSB Secretary General, at RiskLive Asia 2026.

The views expressed in these remarks are those of the speaker in their role as FSB Secretary General and do not necessarily reflect those of the FSB or its members.

Introduction

It is a pleasure to be here. I’ll start this speech where all speeches about the modern financial system start – ancient Greek philosophy. Over 2000 years ago, the Greek philosopher Heraclitus said it was impossible to step into the same river twice, because the river is always changing. This is an apt metaphor for regulators trying to manage the financial system. Last week, I was at the G20 meetings in Bangkok. There were discussions on a lot of topics, including geopolitical developments, the rapid pace of development of artificial intelligence and stablecoins, efforts to modernize financial regulation, and the perceived deterioration of multilateralism. It seems that Heraclitus was right, the financial system river is always moving, and regulators can’t be complacent and assume that what was appropriate yesterday will be appropriate today or in the future.

This fast-changing financial system is currently operating in a challenging environment. Conflicts in the Middle East and Ukraine are contributing to volatility. Some long-term bond yields have reached decade highs. Nonbank financial intermediation, including private credit, continues to expand and is increasingly interconnected with other parts of the financial system. The boom in artificial intelligence (AI) is driving unprecedented, increasingly debt-financed investment in infrastructure. These developments reinforce the need for coordinated international action. Within this challenging environment, the financial system is undergoing profound structural change driven by, among other things, rapid technological advancements.

With that quick introduction to the environment we find ourselves in, I’d like to discuss the work the FSB is doing in AI, stablecoins, regulatory modernisation and resolution to keep pace with the fast-flowing, ever changing river.

Artificial intelligence and responsible innovation

Preserving financial stability in a rapidly changing technological landscape is a key challenge, and artificial intelligence is a good example of that. AI is being rapidly adopted across banks and nonbanks. It offers significant opportunities, including improved efficiency, better risk assessment, enhanced customer services and potentially broader access to financial products.

But AI can also introduce new risks and amplify existing ones. These include dependencies on a small number of third-party providers, challenges in model governance, data quality concerns, cyber risks, operational vulnerabilities and difficulties in explaining or validating outputs. These risks may become particularly significant when advanced or frontier AI models are integrated into critical financial processes. A disruption or weakness affecting one provider or widely used model could have implications across multiple institutions and jurisdictions.

Last week, the FSB published its Sound Practices for Responsible Adoption of AI. The twelve sound practices are intended as a flexible toolkit, rather than as minimum standards. They can be adapted to the size, business model and risk profile of an institution, as well as to the nature and scale of its AI adoption. The practices address organisation-wide AI governance, lifecycle management, cyber-risk mitigation and oversight of third-party providers. They are designed to assist financial institutions and authorities in considering whether, how and at what scale AI should be adopted.

AI capabilities, use cases and associated risks will continue to develop, and our policy response must remain proportionate, flexible and forward-looking. The FSB will continue to monitor this area because the river is always changing.

Vulnerabilities related to global stablecoins

Global stablecoins provide another clear example of how technology is changing the financial system. At present, stablecoins are used predominantly within crypto-asset markets, but their use as a means of payment or store of value could grow and have vast implications for the financial system. Stablecoins can easily cross borders, which offers benefits for the holders. However, this may also limit the ability of any single jurisdiction to assess or address the vulnerabilities comprehensively.

National regulatory frameworks are developing at different speeds, and their interaction at the international level often remains uncertain or undefined. Effective oversight, therefore, requires cross-border cooperation and information sharing, as well as a clear understanding of how risks can be transmitted across borders and sectors.

The FSB is examining these cross-border vulnerabilities and the data needed to monitor them, building on our 2023 high-level recommendations for global stablecoin arrangements, as well as our 2025 review of their implementation. A summary of this ongoing work was submitted to the G20 last week.

Three areas were highlighted for continued attention. First, enhancing monitoring of cross-border vulnerabilities. Second, supporting implementation of the 2023 recommendations, particularly by fostering international cooperation and information‑sharing. Third, gathering information on emerging approaches to planning for the distress or failure of global stablecoin arrangements, with a particular focus on cross-border issues.

Modernising regulatory and supervisory frameworks

Responding to emerging technologies is part of a broader regulatory modernisation effort among financial authorities.

Regulatory and supervisory frameworks must adapt to new technologies, new forms of financial intermediation, changing market structures and evolving economic conditions. Frameworks also need to incorporate lessons learned to identify opportunities to improve effectiveness and efficiency and address any unintended consequences.

Modernisation efforts are widespread in FSB member jurisdictions. Done properly, modernisation is not equivalent to deregulation. It should preserve or enhance financial system resilience. So, to promote greater alignment across these efforts, the FSB has published, for consultation, a report containing eight principles for modernising regulatory and supervisory frameworks. The principles aim to help financial authorities keep regulation and supervision current, focused on the most important risks, and efficient. They encourage the consideration of proportionality, coordination among authorities, and robustness by using consultation and impact assessments.

The principles will be finalised in 2027, following consultation and further engagement with stakeholders. This process will be important. Modernisation principles must be grounded in evidence, informed by experience, and pursued consistently with the lessons of past crises. Again, the river continues to flow. We have to keep up.

Strengthening resolution

In a period of rapid change, it is even more important that jurisdictions fully implement post-2008 regulatory reforms.

The reforms instituted after the Global Financial Crisis have strengthened the resilience of the global financial system, and that achievement must be preserved. Despite this progress, more work is needed. The FSB’s 2025 Interim Implementation Monitoring Review (IMR) identified uneven implementation of important reforms.

A particularly important area for improvement is public sector funding for banks in resolution. Our Peer Review on that subject assesses how jurisdictions are implementing the FSB’s policies on temporary public sector funding for banks in resolution and was sent to the G20 last week.

The findings are clear. Only one in five FSB member jurisdictions is fully compliant with the relevant policies, while approximately half have material gaps. Incomplete implementation limits authorities’ ability to resolve systemic banks and could affect financial stability in periods of stress.

This is an area where progress is both necessary and urgent.

Conclusion

As Heraclitus pointed out over 2000 years ago, things are constantly changing. Innovation and structural changes to the financial system are transforming finance, and the financial system we have today is different from the system that existed at the time of the Global Financial Crisis. Regulation and supervision must keep pace with these changes.

Bringing Heraclitus to modern times, a 20th-century Italian writer, said, “if we want everything to remain the same, everything must change.” We need modern regulatory frameworks to respond to innovation. We need international coordination to address risks that no single jurisdiction can manage alone. And we need effective implementation to make those frameworks credible.

Preserving global financial stability requires a continued commitment to cooperation from all our members, because financial stability is a shared public good.

Thank you.

FSB finalises sound practices for the responsible adoption of artificial intelligence (AI)

15 October 2026

Press enquiries:
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Ref: 14/2026

  • The 12 sound practices emphasise the importance of organisation-wide AI governance and highlight considerations for managing risks throughout the AI lifecycle.
  • The sound practices aim to promote coordination, cooperation and information-sharing among financial institutions, supervisors and other stakeholders, within and across jurisdictions, as AI adoption increases.
  • The FSB strongly encourages the board and senior management of financial institutions to reference the sound practices when developing and refining their institution’s AI governance, risk management and control frameworks.

The Financial Stability Board (FSB) today published its final report on Sound Practices for Responsible Adoption of Artificial Intelligence, reflecting public feedback received on a consultative version of the report, published in June 2026.

The report identifies 12 sound practices to help financial institutions harness the benefits of AI while managing its risks responsibly, in ways that support the resilience of the financial system. The 12 sound practices are organised into two groups, which:

  1. Emphasise the importance of organisation-wide AI governance as financial institutions adopt AI and highlight: (i) the board and senior management’s pivotal role in setting and overseeing alignment between a financial institution’s AI adoption and its business model, risk appetite, and strategy; (ii) maintaining an appropriate governance framework with well-defined roles and responsibilities; (iii) incorporating AI risks into the risk management framework and effective documentation of AI use; and (iv) undertaking continuous learning and adaptation.
  2. Set out a comprehensive framework for managing risks throughout the AI lifecycle from AI development and deployment, focussing on: (v) effective and systematic assessment of the materiality and risks associated with AI use cases at inception and thereafter; (vi) selection of appropriate AI technologies; (vii) appropriate data governance; (viii) explainability of various types of AI and consideration of compensating controls; (ix) evaluation of the performance of AI use cases; (x) appropriate and effective human oversight; (xi) management of AI-related cyber and information and communication technology (ICT) risks; and (xii) management of risks from third-party AI dependencies.

The sound practices serve as a practical toolkit that financial institutions can tailor to their specific context and risk profile and integrate into existing frameworks, including those for cyber and third-party risk. The report includes case studies illustrating the benefits reported by financial institutions and how some sound practices have been applied proportionately.

The sound practices also aim to promote coordination, cooperation and information-sharing among financial institutions, supervisors and other stakeholders, within and across jurisdictions. They build on, and are broadly compatible with, existing and ongoing work by the FSB and other standard-setting bodies.

As AI technologies and applications evolve, the FSB will monitor developments and update the sound practices as necessary to support safe and responsible AI adoption by financial institutions. 

Notes to editors

The FSB launched a public consultation on its proposed sound practices for the responsible adoption of AI in June 2026. The overview of the responses to this consultation has also been published today.

The FSB coordinates at the international level the work of national financial authorities and international standard-setting bodies and develops and promotes the implementation of effective regulatory, supervisory, and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. The FSB also conducts outreach with approximately 70 other jurisdictions through its six Regional Consultative Groups.

The FSB is chaired by Andrew Bailey, Governor of the Bank of England. The FSB Secretariat is located in Basel, Switzerland and hosted by the Bank for International Settlements.

Sound Practices for Responsible Adoption of Artificial Intelligence (AI): Final report

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Summary of document history

Summary of document history

Financial institutions have long used AI tools, but rapid advances – particularly in generative AI (GenAI) and agentic AI – have generated significant interest.

This report sets out 12 sound practices financial institutions are encouraged to consider to facilitate their responsible adoption of AI.

The 12 sound practices are organised into two groups which:

  • emphasise the importance of organisation-wide AI governance as financial institutions adopt AI.
  • set out a comprehensive framework for managing risks throughout the AI lifecycle, from development to deployment.

The board and senior management of financial institutions are strongly encouraged to reference the sound practices as they consider business strategy, technology adoption, and risk management in an increasingly AI-enabled environment.

List of Sound Practices for financial institutions’ responsible AI adoption

Sound Practice 1 (Strategic direction and oversight): The board and senior management align AI adoption and governance with the financial institution’s business model, risk appetite, and strategy.

Sound Practice 2 (Governance and accountability): Financial institutions define clear roles and responsibilities, and maintain an appropriate governance framework to enable responsible AI adoption.

Sound Practice 3 (Incorporation of AI risks into risk management framework and effective documentation of AI use): Financial institutions adopt risk management frameworks that effectively address AI risks, and include processes for documentation of AI use, as well as for materiality and risk assessment.

Sound Practice 4 (Organisational adaptability): Financial institutions learn, adapt and adjust their oversight, governance, risk management practices, and capabilities as AI evolves.

Sound Practice 5 (Materiality and risk assessment): Financial institutions implement an effective and systematic approach to assess the materiality and risk of AI use cases at the inception stage and thereafter.

Sound Practice 6 (Selection process): When selecting AI models or systems, financial institutions consider business objectives, operational and technical needs, as well as the materiality and risks of AI use cases.

Sound Practice 7 (Data governance): Financial institutions establish appropriate data governance to maintain data that is fit-for-purpose for training, testing, and using AI (i.e. accurate, complete, consistent, reliable, secure).

Sound Practice 8 (Explainability and transparency): Financial institutions understand differences in the explainability of various types of AI. If appropriate and feasible, financial institutions adopt more explainable AI, or consider compensating controls. Financial institutions also provide appropriate transparency tailored to different stakeholders.

Sound Practice 9 (Performance management): Financial institutions evaluate the performance of AI use cases proportionately to their materiality and risk, including through performance assessments, testing, and ongoing monitoring.

Sound Practice 10 (Human oversight): Financial institutions implement appropriate and effective human oversight relevant to the materiality, risk, autonomy, complexity, and explainability of different AI use cases.

Sound Practice 11 (Cyber and ICT risk management): Financial institutions manage AI-related cyber and ICT risks, including, where appropriate, by incorporating AI cyber and ICT risk scenarios into tests and exercises, sharing relevant information, and using AI tools in cyber and ICT risk management.

Sound Practice 12 (Third-party AI risk management): Financial institutions appropriately manage risks from third-party AI dependencies with a focus on performance, transparency, data quality, supply chain and concentration risks, and business continuity.

Sound Practices for Responsible Adoption of Artificial Intelligence (AI): Overview of consultation responses

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Summary of document history

Summary of document history

On 10 June 2026, the FSB published a consultation report on Sound Practices for Responsible Adoption of Artificial Intelligence (AI). The objective of the consultation was to gather stakeholder feedback on the proposed sound practices to help financial institutions adopt AI responsibly.

The FSB received around 160 responses to the consultation, which ended on 22 July 2026. The feedback was received from a diverse range of respondents across regions and types of sectors. This note summarises the feedback received on the consultation report and sets out the main changes made to the final report in order to address them.

G20 Implementation Monitoring Review: 2026 report

14 October 2026 | PDF full text (747 KB)

National circumstances are key determinants of implementation outcomes, but the way policies are developed, drafted and presented can also play a role in improving implementation.

This report analyses whether and how the way the FSB develops, drafts, and presents policies affects the implementation of those policies.

Looking at international reforms developed by the FSB after the 2008 Global Financial Crisis, the report finds that national circumstances – including legal frameworks, market structure, and political capacity – are the main reason why implementation has been uneven.

Nevertheless, in a number of cases, difficulties encountered in implementing a standard can also be traced to the policy development process itself. These findings point to targeted and well calibrated reform of the policy development process itself as one element in improving implementation.

This report is the second report produced in the context of the G20 Implementation Monitoring Review (IMR), a strategic review of the FSB’s work to encourage and monitor the implementation of international financial reforms. The review, initiated at the request of the G20, is led by Randal K. Quarles (former FSB Chair and former Vice Chair for Supervision of the US Federal Reserve Board).

FSB consults on high-level principles for regulatory and supervisory modernisation

Press enquiries:
+41 61 280 8477
[email protected]
Ref: 13/2026

  • The FSB is seeking feedback on principles to assist financial authorities in their efforts to improve the effectiveness, efficiency, risk focus, coherence, and forward-looking nature of regulatory and supervisory frameworks.
  • The proposed principles recognise the link between financial stability and sustainable economic growth, build on FSB members’ commitment to implement internationally agreed standards, and aim to preserve or enhance existing levels of financial system resilience.
  • The FSB is also issuing a second report of the G20 Implementation Monitoring Review (IMR) that assesses whether and how the FSB’s policy development process can facilitate implementation of agreed policies.

The Financial Stability Board (FSB) today published two reports: Regulatory and Supervisory Modernisation Principles: consultation report and G20 Implementation Monitoring Review: 2026 report.

The first report sets out eight high-level principles for financial authorities in FSB member jurisdictions to apply in their efforts to ensure regulatory and supervisory frameworks are forward-looking and responsive to new vulnerabilities, technologies, offerings and economic conditions. As financial authorities around the globe pursue such modernisation efforts, these principles should promote alignment and contribute to keeping regulatory and supervisory frameworks effective and responsible.

The proposed principles are based on FSB members’ shared understanding that: (1) financial stability provides the foundation for sustainable economic growth, which in turn supports financial stability; (2) the principles build on the commitment to implement internationally agreed standards; (3) implementation of the principles must be consistent with jurisdictions’ legal frameworks and circumstances; and (4) the principles aim to preserve or enhance existing levels of financial system resilience.

The FSB is inviting comments on this consultation report and the questions set out within it. Responses should be submitted via this secure online form by 8 January 2027. The final report will be published in the first half of 2027.

The 2026 G20 Implementation Monitoring Review report, also released today, analyses whether and how the way the FSB develops, drafts, and presents policies may influence the implementation of those policies. This follows the 2025 findings of the IMR that there has been a worrisome slowdown in implementation that could weaken the financial system’s capacity to withstand future shocks.

Today’s report finds that national circumstances – including legal frameworks, market structure, and political capacity – are the main reason why implementation has been uneven. Nevertheless, in a number of cases, difficulties encountered in implementing a standard can also be traced to the policy development process itself, including insufficient attention to these difficulties. These findings point to targeted and well calibrated reform of the policy development process itself as one element in improving implementation.

Notes to editors

In 2025, the South African G20 Presidency asked the FSB to review how it promotes and monitors implementation of G20 financial sector reforms. To undertake this work, the FSB established an Implementation Monitoring Review (IMR) working group led by an external Chair, Randal K. Quarles (former FSB Chair and Vice Chair for Supervision of the Federal Reserve Board), and supported by a small team of senior members of the FSB. 

The FSB coordinates at the international level the work of national financial authorities and international standard-setting bodies and develops and promotes the implementation of effective regulatory, supervisory, and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. The FSB also conducts outreach with approximately 70 other jurisdictions through its six Regional Consultative Groups.

The FSB is chaired by Andrew Bailey, Governor of the Bank of England. The FSB Secretariat is located in Basel, Switzerland and hosted by the Bank for International Settlements.

Regulatory and Supervisory Modernisation Principles: Consultation report

| PDF full text (532 KB)

Summary of document history

Summary of document history

To remain effective, regulatory and supervisory frameworks must keep pace with the dynamic financial sector and be forward-looking and adaptive to current and future material risks.

Many financial authorities in FSB member jurisdictions have been reviewing their regulatory and supervisory frameworks to pursue various objectives, including evaluating whether they facilitate sustainable economic growth and remain forward-looking and adaptive to current and future material risks.

While existing frameworks appear to have been successful in addressing vulnerabilities exposed by the Global Financial Crisis and in supporting the real economy, they must adapt and respond to new vulnerabilities, technologies, offerings, and economic conditions to remain effective. Responsible governance also calls on financial authorities to address any inefficiencies or unintended consequences of such frameworks, without reducing resilience.

In this context, the FSB is proposing eight high-level principles for modernisation, addressed to financial authorities. The principles are subject to four important understandings: (1) financial stability provides the foundation for sustainable economic growth, which in turn supports financial stability; (2) the principles build on the commitment to implement internationally agreed standards; (3) implementation of the principles must be consistent with jurisdictions’ legal frameworks and circumstances; and (4) the principles aim to preserve or enhance existing levels of financial system resilience.

This consultation report responds to a request of the US G20 Presidency. It is informed by a stocktake of modernisation efforts already underway or completed by FSB members and a symposium hosted by the FSB on proportionality/tailoring and impact analysis.

Questions for consultation
  1. The proposed principles acknowledge the goal of improving the effectiveness, efficiency, risk focus, coherence, and forward-looking nature of regulatory and supervisory frameworks. Do you agree with these aims? Should there be others?
  2. Are the proposed principles sufficiently comprehensive and clear to guide financial authorities’ modernisation of regulatory and supervisory frameworks? How could the proposed principles be clearer?
  3. Are the proposed principles sufficiently flexible to accommodate different legal systems, market structures, and evolving risks over time?
  4. Do the proposed principles adequately maintain or enhance existing levels of resilience?
  5. What are the anticipated benefits or risks of regulatory and supervisory modernisation? Provide evidence or case studies where possible.
  6. Would adding further case studies improve the usability of this report? If so, which proposed principles would benefit from additional case studies?
  7. How can communication around modernisation efforts be enhanced to avoid misperceptions (e.g., that modernisation compromises existing levels of resilience) among stakeholders, including the public?
  8. How could financial authorities modernise their regulatory and supervisory frameworks on an ongoing basis while ensuring sufficient predictability for financial institutions and the public?
  9. How could these proposed principles affect market participants?
  10. Does the preamble to the proposed principles set appropriate and sufficient parameters within which the proposed principles operate?
  11. How could financial authorities best prioritise among various risks on the basis of their materiality?
  12. How could financial authorities strike a balance between incorporating proportionality/tailoring and maintaining frameworks that are well-understood and easy for financial authorities to implement and administer?
  13. How could cliff effects for proportionality/tailoring be appropriately managed?
  14. How could financial authorities best harness the benefits of impact analysis and adequately disclose assumptions and limitations related to such analysis?

Global Stablecoin Arrangements: Cross-border vulnerabilities and financial stability monitoring

12 October 2026 | PDF full text (133 KB)

Global stablecoins are an inherently cross-border and cross-sectoral issue that may give rise to financial stability vulnerabilities.

Global stablecoins have a reach and use across multiple jurisdictions and could become systemically important in one or more of them. These characteristics may limit the ability of a single jurisdiction alone to fully assess or address potential cross-border vulnerabilities. Moreover, the activities involved in operating a global stablecoin may span several types of entities and fall under the oversight of multiple national authorities.

This note summarises ongoing monitoring work at the FSB on global stablecoin arrangements. In particular, it includes an analysis of the structure of global stablecoin arrangements, the potential propagation of vulnerabilities, and the metrics that could support financial stability monitoring. It also looks at the data currently available for financial stability monitoring of stablecoin activities, assessing the sources as well as the benefits and limitations of these data sources.