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

15 October 2026

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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.

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

14 October 2026

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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?

G20 Implementation Monitoring Review: 2026 report

| 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).

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.

FSB Chair sets out FSB work on AI and stablecoins

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Ref: 12/2026

  • Letter by FSB Chair, Andrew Bailey, introduces the reports being delivered at the request of the US G20 Presidency, covering artificial intelligence, regulatory and supervisory modernisation, implementation monitoring and public sector backstop funding.
  • The letter, to G20 Finance Ministers and Central Bank Governors, notes current market conditions and risks associated with artificial intelligence and calls for continued vigilance in safeguarding financial stability.
  • The letter is accompanied by a summary of FSB work on cross-border vulnerabilities of global stablecoin arrangements.

The Financial Stability Board (FSB) today published a letter from its Chair, Andrew Bailey, to G20 Finance Ministers and Central Bank Governors, ahead of their meeting on 15 October.

The letter highlights risks to the global financial system, including heightened volatility in sovereign bond markets, vulnerabilities in private credit markets and risks related to artificial intelligence (AI). It is accompanied by a note on global stablecoin arrangements, which summarises ongoing work at the FSB on vulnerabilities related to global stablecoin arrangements along with data for their financial stability monitoring. The note outlines further work that could help authorities assess, identify, and monitor potential financial stability vulnerabilities related to global stablecoin arrangements. This includes enhancing the monitoring of cross-border vulnerabilities and supporting implementation of the 2023 recommendations, particularly by fostering cross-border cooperation and information sharing.

The letter also introduces the other reports the FSB is submitting to the G20, including:

  • Thematic peer review on public sector backstop funding mechanisms, which identifies gaps in the implementation of public sector backstop funding mechanisms to provide temporary support to banks in resolution.
  • Consultation report on regulatory and supervisory modernisation, which sets out high-level principles which will help FSB members pursue more effective, efficient, risk-focused and forward-looking regulatory and supervisory frameworks.
  • Finalised sound practices for responsible adoption of artificial intelligence (AI), incorporating feedback from the public consultation. The rapid pace of development means that focusing on safe adoption of AI across the financial system will remain an important feature of the FSB’s agenda next year.
  • G20 Implementation Monitoring Review, a follow-up to the October 2025 Interim Review, which assesses the extent to which the FSB’s policy design process facilitates effective implementation of agreed policies.

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 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.

FSB Chair’s letter to G20 Finance Ministers and Central Bank Governors: October 2026

| PDF full text (133 KB)

The pace of change in the financial system continues to accelerate. New technologies and shifting market structures bring important opportunities, but they also require vigilance, agility and international cooperation.

This letter was submitted to G20 Finance Ministers and Central Bank Governors ahead of their meeting on 15 October 2026.

Andrew Bailey calls for continued vigilance in addressing the many risks to the global financial system. These include heightened volatility in sovereign bond markets, vulnerabilities in private credit markets; and risks associated with artificial intelligence (AI).

The letter introduces the reports that the FSB is delivering to the G20, namely:

  • Cross-border Vulnerabilities and Financial Stability Monitoring of Global Stablecoin Arrangements, published today with the Chair’s letter;
  • Thematic Review on Public Sector Backstop Funding, published on 9 October;
  • Sound Practices for the Responsible Adoption of AI;
  • Consultation Report on Regulatory and Supervisory Modernisation;
  • G20 Implementation Monitoring Review Report.

FSB report assesses jurisdictions on public sector backstops

9 October 2026

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Ref: 11/2026

  • Credible public sector backstop funding mechanisms are necessary, as a last resort, to achieve orderly resolution.
  • Review finds that while significant progress has been made, further work is needed in a majority of jurisdictions to be ready, if necessary, to provide public funding to a systemic bank that goes into resolution.
  • FSB recommends jurisdictions take action to ensure that arrangements are in place before a crisis, rather than improvised under pressure.

The Financial Stability Board (FSB) today published a Thematic Review on Public Sector Backstop Funding (PBFs) Mechanisms. The review forms part of work initiated after the 2023 bank failures. The 2023 bank failures demonstrated how quickly a bank can experience acute liquidity stress. A PBF mechanism is the last resort if all other sources of liquidity are used up. It is one part of the comprehensive approach to ensuring global systemically important banks (G-SIBs) have reliable access to liquidity in resolution. A credible mechanism can mean failing banks don’t have to be taken into public ownership.

The review did not assess the full range of resolution powers and tools, focusing instead on public sector liquidity provision as a last resort. Fifteen years after the FSB issued its recommendations on designing a PBF, approximately half of jurisdictions still have material gaps. The review also shows there are multiple ways to design a PBF that can fully meet the FSB’s high standards.

The report recommends that jurisdictions take urgent action to improve their PBF mechanisms. It sets out six recommendations for jurisdictions to achieve full and consistent implementation of the FSB Recommendations. The report also recommends that the FSB supports member jurisdictions in implementing these recommendations by sharing good practices, reviewing and building on existing implementation materials where necessary, and closely monitoring progress in implementing Key Attribute 6 and its Guiding Principles.

Soledad Núñez, Deputy Governor, Banco de España, and Chair of the peer review, said “The FSB has set a demanding but necessary standard for the design of public sector backstops. Having a credible public sector backstop funding mechanism is essential. This report does not assess jurisdictions’ overall ability to respond to financial crises, but it does identify one critical issue that needs addressing. Further work is urgently needed to complete implementation of the FSB’s recommendation on public sector backstops.”

Notes to editors

The FSB adopted the Key Attributes of Effective Resolution Regimes for Financial Institutions in 2011, with the aim of facilitating the resolution of financial institutions without severe systemic disruption or taxpayer losses, while protecting vital economic functions. One element of an effective resolution regime is a public sector backstop funding mechanism, which, if needed as a last resort, can provide temporary funding to firms in resolution to support orderly resolution.

The objective of this review is to examine progress made by FSB member jurisdictions in implementing Key Attribute 6 and the Guiding Principles on the Temporary Funding Needed to Support the Orderly Resolution of a Global Systemically Important Bank (“G-SIB”), which relate to the establishment of public sector backstop funding mechanisms. The review was prepared by a team of experts from FSB member institutions and chaired by Soledad Núñez. Deputy Governor, Banco de España.

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.

Thematic Review on Public Sector Backstop Funding Mechanisms: Peer review report

| PDF full text (1,016 KB)

Incomplete implementation of Key Attribute 6 in most jurisdictions remains a material gap that weakens authorities’ ability to resolve systemic banks and could impact global financial stability.

The FSB adopted the Key Attributes of Effective Resolution Regimes for Financial Institutions in 2011, to make it possible to resolve a failing financial institution without severe systemic disruption and without exposing taxpayers to loss, while preserving the institution’s critical functions.

Key Attribute 6 addresses funding in resolution. To the extent a bank’s own resources or market access to funding is not available or sufficient, Key Attribute 6 and its related guidance calls for a credible public sector backstop funding (PBF) mechanism to be in place, as a last resort, to enable the temporary funding needs of the bank to be met. Having such public funding ready in advance helps prevent the disorderly failure of a systemic bank or costly bailouts.

This peer review looks at the implementation of the FSB’s policies related to the establishment of public sector backstop funding mechanisms to provide temporary funding to banks in resolution, if necessary, as a last resort. The peer review evaluates:

  • whether a credible PBF mechanism exists and can deliver temporary liquidity at the scale and speed likely to be needed for an orderly bank resolution;
  • whether tools are in place for taxpayer losses to be recovered; and
  • whether safeguards are in place to contain moral hazard and ensure the last resort nature of such mechanisms.

The review also identifies good practices, lessons and shared challenges for establishing PBF mechanisms and implementing Key Attribute 6 and the Guiding Principles; and makes recommendations addressed to FSB member jurisdictions and the FSB.

FSB Regional Consultative Group for the Americas meets in Mexico City

30 September 2026

The Financial Stability Board (FSB) Regional Consultative Group for the Americas (RCG Americas) convened on 24-25 September 2026 in Mexico City, hosted by the Bank for International Settlements’ Representative Office for the Americas. The meeting brought together senior officials from central banks, financial authorities, and regulatory bodies across the region to discuss key financial stability topics. Co-chaired by Lisa D. Cook, Governor of the US Federal Reserve Board, and Jide Lewis, Deputy Governor of the Bank of Jamaica, the group held a workshop on regional vulnerabilities from extreme weather events.

The meeting addressed a range of issues, including:

  • Global and regional financial vulnerabilities, with a focus on geopolitical uncertainty, extreme weather financial impacts, capital flows, and exchange rates.
  • Cross-border vulnerabilities and regulatory challenges associated with global stablecoin arrangements.
  • The implications of artificial intelligence (AI) and quantum computing for operational resilience and cybersecurity in the financial sector.
  • Regional crisis preparedness, particularly for operational risk events such as cyber incidents and third-party outages.

Members also provided input on the FSB’s 2026 work priorities and discussed how the RCG Americas can contribute to advancing these priorities.