FSB Chair highlights global shifts and multilateralism's enduring test
Financial Stability Board Chair Randal K. Quarles reflected on a year of profound global shifts and evolving financial challenges in the foreword to the FSB Annual Report 2025. He emphasized the critical importance of multilateralism in maintaining financial stability amidst increasing fragmentation.
A landscape of profound shifts
The year 2025 was marked by significant changes in the global landscape, testing multilateralism amidst increasing fragmentation and unpredictability.
Despite these challenges, the financial sector demonstrated resilience, a testament to post-global financial crisis reforms.
However, the system itself is transforming, introducing new complexities.
Key developments include the rapid growth of private finance, increased leverage in core markets, the expansion of digital assets, and advancements in artificial intelligence.
Concurrently, the global economy faces structural headwinds such as slowing productivity growth and demographic pressures.
These trends underscore the necessity of openness and innovation, with financial stability remaining a crucial prerequisite for unlocking opportunities and achieving sustainable economic growth.
Delivering on a complex mandate
Despite the challenging global environment and rising vulnerabilities, the FSB continued to fulfill its mandate in 2025.
The Annual Report details finalized recommendations for addressing leverage in nonbank financial intermediation, assessments of crypto-asset and stablecoin recommendations, and examinations of AI-related vulnerabilities in finance.
The strategic review of G20 reform implementation, launched in 2025, revealed a slowdown in progress.
While cooperation has strengthened since the GFC, full, timely, and consistent implementation across reforms has not yet been achieved.
The next phase of the review will identify root causes and promote more effective implementation, with enhancing the FSB's monitoring framework as a key priority.
Multilateralism's enduring test
Despite the optimistic framing, the report subtly reveals the immense pressure on global cooperation.
The acknowledged slowdown in G20 reform implementation underscores a growing gap between ambition and execution.
Sustaining financial stability in a fragmented world demands more than just rhetoric; it requires tangible, consistent action from all members.