Coverage: weekly note · Information to 12 October 2026
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TGB Weekly Research Note · 12 October 2026
The FSB's peer review of public sector backstop funding, published on 9 October 2026, finds that only about one in five member jurisdictions are fully compliant with Key Attribute 6.
The desk view
The FSB's peer review of Key Attribute 6 shows how far resolution regimes still are from a credible liquidity backstop. Table 1 rates 4 jurisdictions as compliant and 2 as non-compliant, with the EU Banking Union counted as one. The jurisdictions demonstrating the greatest funding scale have pre-arranged routes to flexible public resources. The UK, the US and Japan show what that looks like, while the Banking Union and Switzerland show two different ways of falling short. This suggests that the standard is failing on engineering and legal readiness more than on principle: a fund or a promise is not a backstop unless it can be scaled and deployed within a resolution weekend. The FSB's own recommendations point the same way.
A standard that most jurisdictions have not met
The FSB peer review, published on 9 October 2026, found that only about one in five FSB member jurisdictions are fully compliant with Key Attribute 6, while about half have material gaps. Table 1 gives the overall distribution as 4 compliant (21%), 5 largely compliant (26%), 8 materially non-compliant (42%) and 2 non-compliant (11%). Those counts add up to 19 jurisdictions, with the EU Banking Union counted as one and individual EU member states not included.
The weight of the result sits in the lower two categories. Together, the materially non-compliant and non-compliant groups account for 10 jurisdictions, or 53% of the total. The report itself says a majority of jurisdictions are deemed either materially non-compliant or non-compliant. The press release puts the same point in terms of time: fifteen years after the FSB issued its recommendations on designing a public sector backstop, approximately half of jurisdictions still have material gaps.
What Key Attribute 6 asks for
Key Attribute 6 treats a bank's own liquidity and private markets as the preferred sources of funding. Where those are not available or sufficient, it calls for a credible public sector backstop funding mechanism as a last resort, so that the bank's temporary funding needs can be met and an orderly resolution achieved. An effective resolution regime must not only allocate losses and recapitalise a failing bank but also ensure that it can obtain sufficient liquidity to maintain critical functions through resolution.
The review asks whether a credible mechanism exists and can deliver temporary liquidity at the scale and speed likely to be needed for an orderly bank resolution. It also asks whether tools are in place for taxpayer losses to be recovered, and whether safeguards contain moral hazard and ensure the last-resort nature of such mechanisms.
The work was initiated after the 2023 bank failures, which demonstrated how quickly a bank can experience acute liquidity stress. Several jurisdictions are home to more than one global systemically important bank, which could raise liquidity needs if more than one were resolved simultaneously.