On 19 January 2020, the Financial Stability Board (FSB) published its Global Monitoring Report in Non-Bank Financial Intermediation 2019. The report sets out the results of the FSB’s most recent annual monitoring exercise that assesses global trends and risks from non-bank financial intermediation (NBFI). It covers data up to end-2018 from 29 jurisdictions, which together represent over 80% GDP.

The FSB’s monitoring exercise compares the size and trends of financial sectors in aggregate and across jurisdictions based primarily on sectoral balance sheet data. It focuses on those parts of NBFI that perform economic functions which may give rise to bank-like financial stability risks or regulatory arbitrage.

The main observations from this year’s report include:

  • total financial assets have grown by 1.4% in 2018, driven largely by banks;
  • lending by other financial intermediaries (OFIs) has increased by 3%; and
  • interconnectedness between banks and OFIs through credit and funding relationships has largely unchanged since 2016.

The term “non-bank financial intermediation” is used throughout the report reflecting the FSB’s decision to move away from the term “shadow banking”.