On 7 April 2021, there was published an official communique following the second meeting of G20 Finance Ministers and Central Bank Governors under the Italian G20 Presidency. During the meeting the discussion spanned from issues covering the global economy, efforts to push forward the economic recovery and promoting more sustainable growth, to supporting the most vulnerable countries, advancements in international taxation matters and financial sector related issues.
In relation to financial sector related issues the communique notes among other things:
- The G20 welcomes the Financial Stability Board’s (FSB) evaluation report on the effectiveness of too-big-to-fail reforms for systemically important banks. It will work to address the gaps in reforms identified in the evaluation.
- The G20 is committed to taking stock of the lessons learned from the COVID-19 pandemic from a financial stability perspective.
- Building upon the FSB “Holistic Review” of the March 2020 market turmoil, the G20 will work to strengthen the resilience of the non-bank financial intermediation (NBFI) sector with a systemic perspective. The G20 also looks forward to the FSB presenting a consultation report on policy proposals to enhance money market fund resilience in July, a final report in October and an update on the broader workplan for NBFIs.
- The G20 looks forward to the FSB progress report on how regulatory, supervisory and oversight frameworks address so-called “global stablecoins”, and to a broad discussion on the cross-border use of central bank digital currencies and wider implications for the international monetary system. It reiterates that no so-called “global stablecoins” should commence operation until all relevant legal, regulatory and oversight requirements are adequately addressed through appropriate design and by adhering to applicable standards.
- The G20 looks forward to a progress report on transition away from LIBOR. It welcomes the additional clarity provided by the announcements of cessation dates for LIBOR benchmarks and reiterate the importance of orderly transition before end-2021.