International reform of the shadow banking sector mandated by the G20 and spearheaded by the FSB is well underway with a number of global and local initiatives. Areas of particular focus include the interaction of the regular banking system with shadow banking, securitisation activity, repos and stock lending and money market funds.
The FSB is also continuing its monitoring and surveillance activities to better understand the scope of shadow banking and associated risks. There is also increasing evidence that many borrowers are increasingly looking outside the regular banking system for funding with a growth in peer to peer lending and other alternative financing. The size of the shadow banking sector in certain jurisdictions, particularly the PRC, has been the subject of much recent debate.
Partners Peter Green and Jeremy Jennings-Mares will look at recent regulatory developments in this area including legislative proposals in the EU and the US, and consider likely future action by regulators and legislators.