The FSB has designated reforms to non-bank financial intermediation (formerly referred to as “shadow banking”) as one of the priority areas for implementation monitoring. The reforms focus on five areas where the FSB has been coordinating and contributing to the development of policies:

  1. mitigating spill-over risks between the banking system and the system of non-bank financial intermediation;

  2. reducing the susceptibility of money market funds (MMFs) to “runs”;

  3. improving transparency and aligning incentives associated with securitisation;

  4. dampening procyclicality and other financial stability risks associated with securities financing transactions such as repos and securities lending; and

  5. assessing and mitigating systemic risks posed by other market-based entities and activities.

The task of regular monitoring and reporting in this area is carried out by the FSB in collaboration with standard-setting bodies as follows:

  • FSB on policy measures to dampen procyclicality and other financial stability risks in securities financing transactions (iv above), and on assessing and mitigating systemic risks posed by other non-bank financial intermediation entities and activities (v);

  • Basel Committee on Banking Supervision (BCBS) on policy measures to mitigate risks in banks’ interactions with non-bank financial entities (i); and

  • International Organization of Securities Commissions (IOSCO) on policy measures to reduce the susceptibility of money market funds (MMFs) to “runs” (ii), and to improve transparency and align incentives in securitisation (iii).

The FSB has also created a system-wide monitoring framework to track developments in global non-bank financial intermediation with a view to identifying the build-up of systemic risks and initiating corrective actions where necessary. The main findings are presented in the annual monitoring report.

The FSB reports on the status of implementation of non-bank financial intermediation-related reforms in its Annual Report.

Status of implementation

View status of implementation of reforms in priority areas by FSB jurisdictions as reported in the latest FSB Annual Report to G20 (as of October 2021).

Key documents