Training course on Financial Market Infrastructure (FMI) Oversight by a Central Bank

Module 1: Introduction to Financial Market Infrastructures (FMIs)

Definition and types of FMIs (payment systems, CCPs, CSDs, SSSs, TRs)

The role of FMIs in financial stability and monetary policy transmission

Systemic importance of FMIs in normal and stressed conditions

Module 2: Principles for Financial Market Infrastructures (PFMI)

Overview of the CPMI-IOSCO Principles

Key risk categories (legal, credit, liquidity, operational, general business risk)

Responsibilities of authorities in FMI oversight

Module 3: Central Bank’s Role in FMI Oversight

Central bank as overseer, operator, participant, and catalyst

Legal frameworks and supervisory mandates

Cooperation with securities regulators and international bodies

Module 4: Risk Management in FMIs

Credit and liquidity risk in CCPs and payment systems

Collateral management and margin requirements

Operational risk and business continuity planning

Module 5: Cyber Resilience and Operational Risk

Cybersecurity frameworks for FMIs

Best practices and international standards (G7 Fundamental Elements, CPMI-IOSCO guidance)

Incident response and resilience testing

Module 6: FMI Interdependencies and Cross-Border Issues

Domestic and international FMI linkages

Cross-border cooperation and supervisory colleges

Risks from global CCPs and cross-currency settlement systems

Module 7: FMI Oversight Tools and Methodologies

Supervisory assessments and onsite inspections

Quantitative monitoring tools and key risk indicators

Disclosure frameworks and transparency requirements

Module 8: Recovery and Resolution of FMIs

Principles for recovery planning

Tools for FMI resolution (bail-in, recapitalization, continuity planning)

Central bank’s role in crisis management and systemic event handling

Module 9: Innovation and Future of FMIs

Fintech, distributed ledger technology (DLT), and tokenized settlement assets

Implications of CBDCs on FMIs

Balancing innovation with systemic safety

Module 10: Case Studies and Global Experiences

Oversight of large-value payment systems (e.g., TARGET2, Fedwire)

CCP stress events and lessons learned

FMI oversight in emerging markets

Module 11: Applied Oversight Workshop

Mock assessment of an FMI against PFMI principles

Identifying vulnerabilities and drafting supervisory recommendations

Group presentations and peer review

Module 12: Capstone Project

Developing an FMI oversight strategy for a central bank

Policy recommendations for improving resilience and efficiency

Final presentation and instructor feedback