BOE’s Bailey urges ‘global cooperation and engagement’ at G20

Bank of England Governor Andrew Bailey pressed the world’s most powerful finance officials to embrace “global cooperation and engagement” at a Group of 20 meeting that has been marred by the absence of US Treasury Secretary Scott Bessent.

In his first dispatch to G-20 finance ministers and central bank governors as chair of the Financial Stability Board, Bailey noted the fraught backdrop. Economic and geopolitical tensions have increased, he said, while global debt vulnerabilities remain high and uncertainty continues to “weigh on growth expectations.”

“Jurisdictions cannot achieve financial stability alone,” he wrote in a letter Monday, days after reports that Bessent would skip the gathering of finance ministers in South Africa for the second time in a row. “A globally interconnected system requires global cooperation and engagement.”

Bailey also used the letter to set out his priorities as chair of the FSB’s group of central bankers, regulators and treasury officials, highlighting nonbank financial institutions, private finance and stablecoins.

He pledged to pursue “robust implementation of the various agreed policies” for NBFIs — which include insurers, asset management firms, hedge funds and family offices.

As for private credit, Bailey said he would prioritize enhancing policymakers’ understanding of “the potential risks” stemming for what he described as the industry’s “opacity.” Last week, the FSB announced a “deep dive” into the vulnerabilities of private credit.

The FSB will also give “further attention” to the evolution of stablecoins, he wrote, after telling a UK newspaper that he would caution banks against issuing their own cryptocurrencies pegged to traditional money.

In his update on the risk outlook, Bailey said that while conditions have improved since US President Donald Trump’s April 2 tariff announcements upended markets, the global financial system isn’t in the clear just yet.

“We have seen further economic and geopolitical risks crystallise and global debt vulnerabilities remain high,” he wrote. “As such, uncertainty continues to weigh on growth expectations. We need to remain vigilant, however, to the risk of disruptive market moves and we will look at the lessons to be learnt from the market events in April.”

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