Basel Committee curbs G-SIB window dressing, finalises machine-readable Pillar 3 and flags AI leverage

Serguey Asael Shinder05 October 2026, 07:242 min read

The Basel Committee on Banking Supervision met in Indonesia on 28 and 29 September and announced a set of decisions on 1 October. Its chair, Sveriges Riksbank Governor Erik Thedéen, said the meeting allowed members to discuss risks to the global banking system, advance supervisory and regulatory work and take stock of modernisation efforts.

Artificial intelligence. The Committee said the financial footprint of the AI ecosystem is expanding rapidly, with greater use of leverage and increasingly interconnected financing arrangements. Frontier AI could make financial services more efficient but could also amplify operational vulnerabilities, including from cyber attacks and correlated dependencies. It agreed to review whether the "event type" loss categories in its operational risk framework are adequate, with a focus on cyber risk and AI.

Decisions taken.

• Global systemically important banks: it approved the results of the end-2025 G-SIB assessment, which go to the Financial Stability Board before the 2026 list is published, and approved revisions to the assessment framework to reduce window-dressing, the practice of adjusting balance sheets around reporting dates. The revisions are due later in October, together with a consultation on whether to recognise cross-border exposures inside the European banking union in the G-SIB framework.
• Disclosure: it approved a final standard for machine-readable Pillar 3 disclosures, because most banks publish them only as PDFs that are hard to aggregate and compare. Publication is expected around year-end.
• Interest rate risk: after finding shortcomings in how banks manage interest rate risk in the banking book under its 2016 standard, it will consult next month on additional Pillar 2 guidance.

Work in progress. The Committee expects to give an update on its targeted review of the prudential standard for banks' crypto-asset exposures by the end of the year. It is also considering updates to its 2008 principles for liquidity risk management, developing voluntary supervisory tools on credit risk and governance, and reported on a survey of anti-money-laundering risk assessment practices across 19 jurisdictions.

What it means

Two items will matter most to large banks: the window-dressing revisions, which change how G-SIB surcharges are measured around year-end, and the crypto standard review, which decides how much capital banks must hold against digital assets. Both have dates attached, October and year-end, so their text will soon be testable.