On 16 November 2018, the Financial Stability Board (FSB) published its progress report (the Report) to the G20 November summit on its action plan to assess and address the decline in correspondent banking.

The FSB launched in November 2015 an action plan to address the decline in correspondent banking relationships, centred around:

• examining the dimensions and implications of the issue;
• clarifying regulatory expectations, including through guidance by the Financial Action Task Force (FATF) and the Basel Committee on Banking Supervision (Basel Committee);
• domestic capacity-building in jurisdictions that are home to affected respondent banks;
• strengthening tools for due diligence by correspondent banks.

The Report details actions taken by the FSB since its March 2018 progress report, notably:

• data collection and analysis: the FSB published on 16 November 2018 an update of its correspondent banking data report. The World Bank has also published country case studies that provide qualitative detail regarding the impact of the decline of correspondent banking;
• clarifying regulatory expectations: the FATF and Basel Committee conducted surveys of their membership to assess the transmission and traction of the FATF guidance on correspondent banking and the revised Basel Committee guidance on correspondent banking. A large proportion of the entities surveyed by the FATF stated they had received communication from their regulators on at least one of the elements of the FATF / Basel Committee guidance, and over 20 FATF members have taken concrete actions to communicate the new guidelines;
• domestic capacity building: the Correspondent Banking Coordination Group (CBCG) has committed to explore how solutions developed to address the reduction in correspondent banking relationships might also be used in the context of trade finance, and HM Treasury, and the United Nations Office of Drugs and Crime recently accepted invitations to become members of the CBCG work stream for coordination;
• strengthening tools for due diligence by correspondent banks: members of the Wolfsberg Group have expressed their intention to implement the use of the Correspondent Banking Due Diligence Questionnaire with new and existing respondents by end-2019. Progress has also been made concerning the Legal Entity Identifier (LEI), with total issued LEIs exceeding 1.3 million; and
• access of remittance providers to banking services: In March 2018, the FSB published a report taking stock of existing initiatives to address access to banking services by remittance providers and including 19 recommendations aimed at national authorities, banks and remittance service providers.