This is a briefing paper authored by Oliver Wyman, published under Chatham House's Global Economy and Finance Programme’s ‘Rebuilding International Economic Cooperation’ project. It explores how key changes in the bank regulatory framework introduced after the global financial crisis of 2008–09 subsequently evolved and then coped with the unprecedented economic shock from COVID-19.

The post-2008 reforms included new principles for liquidity management, increased capital requirements and widespread stress-testing of banks. The COVID-19 economic crisis and associated financial market turbulence in early 2020 provided the first major test of these measures. So far, banking systems have proven resilient, albeit aided by unprecedented fiscal and monetary measures.

The Financial Stability Board’s 2021 review of the regulatory system’s performance during the pandemic will be critical to its future international coherence. The review must fully explore such key questions as the way the system of capital and liquidity buffers interacted with exceptional policy support, as well as addressing problems that were emerging before the pandemic.