Brad Jones: Geopolitics and the financial system - some echoes from history
Remarks by Mr Brad Jones, Assistant Governor (Financial System) of the Reserve Bank of Australia, at the Australian Banking Association's Conference – Banking 2026, Melbourne, 17 June 2026.
The international financial system has operated downstream from the larger system of international order ever since the modern state system emerged in Europe four centuries ago. This order has gone through several major realignments, each with profound consequences. While for much of the past generation, financial system participants might have safely relegated geopolitics to the history books, the issues at hand are no longer purely of historical interest.
Indeed, they are compelling policymakers around the world to step up efforts to ensure their financial systems can operate through a more perilous risk environment. As I will set out today, here in Australia this has been a central focus of the Council of Financial Regulators (CFR) for some years. A strained geopolitical environment could have first-order implications for the financial system in various ways relating to: the resilience of critical payments infrastructure; threats to key institutions posed by disinformation campaigns and insider and foreign interference; the fragmentation of cross-border capital flows under the shadow of asset seizures; increasingly sophisticated sanctions evasion techniques; and public-private coordination challenges in strengthening the financial safety net at home and abroad.
The punchline is this: it is in our collective interest to prepare for a financial system that is more shock-prone in the future.