covid event, primarily how the shock moved through the financial system and which critical vulnerabilities it exposed. i also want to outline further work that the fsb plans to conduct in light of this experience, including a more in - depth assessment of how various segments of the nbfi sector performed. going forward, i expect the nbfi sector to be an ongoing focus of the fsb. the global financial system and economy prior to the shock when covid - 19 emerged early this year, the global financial system was in several ways fundamentally different than it was at the outset of the financial crisis of more than a decade ago. regulatory reforms implemented in response to that crisis, changes in technology, developments in u. s. dollar funding, and, importantly, the growth of nbfi all contributed to a changed landscape. beyond the growth of the nbfi sector, there has also been considerable change within this sector. business models and financial services provided by nbfis have become more diverse. this variation can be seen in new products, services, and financial models. new types of markets — for example, private debt markets — and new forms of intermediation, such as fintech credit, have sprung up. investments by nonbank entities in certain credit products, such as fixed income exchange traded funds and collateralized loan obligations, and participation in some 1 / 5 bis central bankers'speeches credit segments, such as mortgage and consumer finance, has grown. change is also evident in how the sector operates in different jurisdictions. for example, provision of credit by nonbank fintech lenders varies greatly across fsb member jurisdictions. in sum, nonbanks now play a larger and more diverse role in financing the real economy and managing the savings of households and companies. the past decade also saw an evolution in the global u. s. dollar funding landscape. while the u. s. economy forms a smaller percentage of global gross domestic product than in the past, the u. s. dollar still dominates international finance as a funding and investment currency, and its widespread use has given rise to a complex and geographically dispersed network of financial relationships. this means global economic and financial activity is highly dependent on the ability of u. s. dollar funding to flow smoothly and efficiently between users. in contrast to bank intermediation, market - based financing in u. s. dollars has outpaced the growth of the global economy. nonbank institutions — such as insurers, pension

, investor protection, and efficiency objectives alongside an understanding of the benefits of money market funds that should be preserved. additionally, other types of open - ended funds, especially those invested in less liquid assets, also experienced large outflows, and further work is likely needed to understand liquidity risks in these funds. i believe that, as with the work undertaken in the aftermath of the global financial crisis, the fsb will provide a forum for international experts to understand vulnerabilities in nbfis, promptly 4 / 5 bis central bankers'speeches prescribe reasonable policy solutions, and monitor the implementation and effectiveness of any agreed - upon reforms. conclusion global coordination through the fsb has helped reveal a number of issues associated with particular types of market participants and mechanisms that may have caused liquidity imbalances and propagated stress. since the start of the pandemic, fsb members regularly connected to share experiences, analyses, and concerns about coming events. in so doing, the membership as a whole has been agile, coordinated, and quick to respond. we have seen that decisive action helped to stabilize markets through facilitating funding to support the economy. addressing vulnerabilities in the financial system going forward, therefore, will require a holistic perspective given the various linkages within nonbank financial intermediation and between nonbanks and banks. we have gained some clarity regarding areas of the market that needed significant bolstering and have to look closely at whether and how resilience in these segments can be improved. next month, when the fsb delivers our nbfi report and proposals to the g20 summit, we will be doing what the fsb does best : leveraging the strength of our broad and diverse membership to provide a clear path forward to strengthen the resilience of the global financial system. 1 see international monetary fund, world economic outlook update ( washington : international monetary fund, june 2020 ) ; global growth is projected at – 4. 9 percent in 2020, which would leave 2021 gdp some 6 - 1 / 2 percentage points lower than in the pre - covid - 19 projections of january 2020. 2 with respect to institutional prime money market funds, outflows as a fraction of the funds ’ assets exceeded that during the run in september 2008, although the march outflows were smaller in dollar terms because these funds are much smaller now than in 2008. 5 / 5 bis central bankers'speeches