Central Bank Governor co-chairs FSB Regional Consultative Group for Asia

CBSL Governor Dr. Nandalal Weerasinghe, HKMA Chief Executive Eddie Yue and FSB Secretary General John Schindler

Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe was among the regional central bank heads co-chairing the Financial Stability Board (FSB) Regional Consultative Group for Asia (RCG Asia) meeting, held recently, that placed financial market developments and their impact on the region under fresh spotlight. 
The meeting was co-chaired by Hong Kong Monetary Authority (HKMA) Chief Executive Eddie Yue, the current member co-chair, Dr. Weerasinghe and the current non-member co-chair of the RCG Asia. 
Held last week in Hong Kong, the meeting focused on the vulnerabilities arising from non-bank financial intermediation, deepening of the sovereign-bank nexus in some emerging markets and developing economies and ways to promote effective regulation and supervision of crypto-asset-related risks. 

The group’s latest meeting highlighted that the global financial system is adjusting to a higher interest rate environment.
“More fundamentally, the current tightening is occurring in a global financial system where the provision of finance through non-banks is comparable in size to bank credit. In addition, some EMDEs face a challenge from the combination of high government debt and large bank holdings of domestic government bonds,” the FSB said in a statement to the media.
The group also discussed the vulnerabilities arising from NBFIs. The members shared their experiences of identifying, monitoring and addressing these risks and welcomed the FSB’s continued focus on enhancing resilience in the sector.
Since the previous meeting in May, the FSB has finalised a global regulatory framework for crypto-asset activities and set out a road map, developed together with the relevant international organisations and standard-setting bodies, to ensure the effective implementation of the FSB’s and International Monetary Fund’s recommendations.The group discussed progress in implementing the regulatory frameworks for crypto-asset activities in their jurisdictions and ways to ensure effective and coordinated implementation of the comprehensive policy response for crypto-assets. This included, among others, enhanced capacity building, data sharing and more frequent dialogue among the members.
The members shared their experiences of identifying, monitoring and addressing these risks and welcomed the FSB’s continued focus on enhancing the resilience of financial systems. The FSB coordinates at international level the work of national financial authorities and international standard-setting bodies to develop and promote the implementation of effective regulatory, supervisory and other financial sector policies. The membership of the RCG Asia comprises financial authorities from Australia, Brunei Darussalam, Cambodia, China, Hong Kong SAR, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Pakistan, the Philippines, Singapore, Sri Lanka, Thailand and Vietnam. 
The FSB has six Regional Consultative Groups, established under the FSB Charter, to bring together financial authorities from the FSB member and non-member countries to exchange views on vulnerabilities affecting the financial systems and on initiatives to promote financial stability.