Global regulators have long kept an eye on the shadow banking sector from afar and warned that it may be a source of systemic risk, but the pandemic-driven market turmoil in March was a tipping point. The Financial Stability Board is now calling for firm action to “strengthen the resilience of non-bank financial intermediation”.

FSB warns of climate change threat to financial stability
Policy-makers and their advisers have at last recognised the implications of climate change on financial stability, marking a sea change in political sentiment on this issue. By Victor Smart

UK faces tough battle for EU equivalence
With Brexit done, UK negotiators are now striving to reclaim some access to EU financial markets: an ambitious goal, according to some, and one in which the benefits may be overstated.

China gears up for launch of digital currency – with global implications
Residents of Suzhou, an ancient city in the Yangtze Basin, recently pioneered China’s new digital currency – and banks and fintechs are taking note.

FSB treads fine line on CCP resolution issue in final guidance
Clearing house members have cautiously welcomed the latest FSB guidance on CCP resolution, which contained few surprises, but argue it should go even further.

CBDC experiment paves way for market infrastructure revolution
The infrastructure of financial markets came a step closer to being revolutionised following an experiment involving the Bank for International Settlements (BIS) and the Swiss National Bank (SNB) using central bank digital currencies (CBDCs) for settling transactions. By Justin Pugsley

UK-US look to regulatory co-operation to boost cross-border financial services
A free trade agreement between the UK and the US looks unlikely any time soon. However, this will not stop the two forging greater regulatory co-operation to boost financial services activity, potentially creating a template for other international agreements.

Financial firms will have to adapt to seismic changes this year
The year 2020 generated seismic shifts in the structure of markets, ways of working, the landscape of risks and paths of recovery. Harnessing these requires firms to prioritise a purposeful recovery, resilience and restructuring in the year ahead. By Adam Markson, head of UK and Ireland risk practice at Accenture.

GRC 2021 predictions: digitising in a hybrid world
Governance, risk and compliance (GRC) teams started 2020 with a clear picture of what they were going to focus on this year, but the onset of Covid-19 pandemic threw up new GRC challenges, such as around bank staff having to work from home. By Henry Umney, SVP Commercial at Mitratech.