FSB annual report flags data gaps as nonbank finance risk rises
The Financial Stability Board (FSB) published its Annual Report for 2025 in late March 2026, painting a picture of a financial system that has so far held firm against mounting pressures; but one where significant vulnerabilities lurk in the shadows, particularly in the fast-growing world of nonbank financial intermediation (NBFI).
The report, chaired by Bank of England Governor Andrew Bailey, highlights a striking fact: NBFI grew by 9.4% in 2024, double the pace of the banking sector, and now represents 51% of global financial assets. Yet the FSB’s own assessment concedes that data challenges mean that understanding nonbank positions and leverage is murky businesses. In response, the FSB has established a new Nonbank Data Task Force to begin tackling the problem, starting with a test case on leveraged trading strategies in sovereign bond markets.
NBFI has been a growing concern for regulators. The sector encompasses hedge funds, money market funds, open-ended property funds and private credit vehicles. All of the above are relatively opaque, growing rapidly, and increasingly interconnected with the traditional banking system.
The FSB’s frank acknowledgement of its own data limitations is arguably the most important thread running through this report. High-quality, machine-readable data is exactly what regulators need to monitor these risks effectively. The FSB’s new task force is starting from a test case, but it’s not (yet) a solution.
Read the full report here.
