FSB Chair sets out FSB work on AI and stablecoins

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Ref: 12/2026

• Letter by FSB Chair, Andrew Bailey, introduces the reports being delivered at the request of the US G20 Presidency, covering artificial intelligence, regulatory and supervisory modernisation, implementation monitoring and public sector backstop funding.
  
• The letter, to G20 Finance Ministers and Central Bank Governors, notes current market conditions and risks associated with artificial intelligence and calls for continued vigilance in safeguarding financial stability.
  
• The letter is accompanied by a summary of FSB work on cross-border vulnerabilities of global stablecoin arrangements.

The Financial Stability Board (FSB) today published a letter from its Chair, Andrew Bailey, to G20 Finance Ministers and Central Bank Governors, ahead of their meeting on 15 October.

The letter highlights risks to the global financial system, including heightened volatility in sovereign bond markets, vulnerabilities in private credit markets and risks related to artificial intelligence (AI). It is accompanied by a note on global stablecoin arrangements, which summarises ongoing work at the FSB on vulnerabilities related to global stablecoin arrangements along with data for their financial stability monitoring. The note outlines further work that could help authorities assess, identify, and monitor potential financial stability vulnerabilities related to global stablecoin arrangements. This includes enhancing the monitoring of cross-border vulnerabilities and supporting implementation of the 2023 recommendations, particularly by fostering cross-border cooperation and information sharing.

The letter also introduces the other reports the FSB is submitting to the G20, including:

• Thematic peer review on public sector backstop funding mechanisms, which identifies gaps in the implementation of public sector backstop funding mechanisms to provide temporary support to banks in resolution.
• Consultation report on regulatory and supervisory modernisation, which sets out high-level principles which will help FSB members pursue more effective, efficient, risk-focused and forward-looking regulatory and supervisory frameworks.
• Finalised sound practices for responsible adoption of artificial intelligence (AI), incorporating feedback from the public consultation. The rapid pace of development means that focusing on safe adoption of AI across the financial system will remain an important feature of the FSB's agenda next year.
• G20 Implementation Monitoring Review, a follow-up to the October 2025 Interim Review, which assesses the extent to which the FSB's policy design process facilitates effective implementation of agreed policies.

Notes to editors

In 2025, the South African G20 Presidency asked the FSB to review how it promotes and monitors implementation of G20 financial sector reforms. To undertake this work, the FSB established an IMR working group led by an external Chair, Randal K. Quarles (former FSB Chair and Vice Chair for Supervision of the Federal Reserve Board), and supported by a small team of senior members of the FSB.

The FSB coordinates at the international level the work of national financial authorities and international standard-setting bodies and develops and promotes the implementation of effective regulatory, supervisory, and other financial sector policies in the interest of financial stability. It brings together national authorities responsible for financial stability in 24 countries and jurisdictions, international financial institutions, sector-specific international groupings of regulators and supervisors, and committees of central bank experts. The FSB also conducts outreach with approximately 70 other jurisdictions through its six Regional Consultative Groups.

The FSB is chaired by Andrew Bailey, Governor of the Bank of England. The FSB Secretariat is located in Basel, Switzerland and hosted by the Bank for International Settlements.