Last summer the Financial Stability Board (FSB) published a high-level policy framework for shadow banking entities. The framework focuses on the underlying economic functions of non-bank financial entities instead of their legal forms, and set out overarching principles that supervisors should adhere to in their oversight of non-bank financial entities that are identified as posing shadow banking risks that threaten financial stability.
The FSB has now launched a peer review on the implementation of its policy framework. The objective of the review is to evaluate the progress made by FSB member jurisdictions in implementing the principles – in particular, to assess shadow banking entities based on economic functions, to adopt policy tools if necessary to mitigate any identified financial stability risks, and to participate in the FSB information-sharing process.
The FSB invites feedback from financial institutions, industry and consumer associations as well as other stakeholders. The deadline for feedback is 24 July 2015.