Shadow banking breaks $80trn mark 16 November 2015Basel Reporter: Drew Nicol
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The Financial Stability Board (FSB) valued the shadow banking industry at $80 trillion in 2014, up from $78 trillion 2013.
The new figures were collated from data from 20 jurisdictions and the eurozone area.
While researching for this report, the FSB introduced a new activity-based ‘economic function’ approach in its annual monitoring this year.
This narrowed the focus to those parts of the non-bank financial sector where shadow banking policy changes may be needed to mitigate risks.
The first results of this approach highlight that the new activity-based, narrow measure of shadow banking grew by $1.1 trillion since 2013 to total $36 trillion in 2014.
This is equivalent to about 30 percent of the overall non-bank financial sector assets and 60 percent of the GDP of the 26 participating jurisdictions.
The FSB’s finding were presented to the G-20 Summit this weeks as part of its role as advisor on banking reform.
Mark Carney, chair of the FSB, said: “Non-bank financing is a welcome additional source of credit to the real economy.”
“The FSB’s efforts to transform shadow banking into resilient market-based finance, through enhanced vigilance and mitigating financial stability risks, will help facilitate sustainable economic growth.”
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