11  In the decade ahead, members of the G20 will be increasingly well-positioned to defer to each other’s comparable regulatory outcomes, supported by commitments to common minimum standards and open supervisory co-operation. These commitments could be reinforced by reliance on independent peer reviews and a new, independent dispute resolution mechanism. Brexit will be a litmus test of the future of international cooperation. The UK and the rest of the EU have exactly the same rules and the most highly developed frameworks of supervisory cooperation. Their capital and banking markets are already highly integrated. They have the potential to create the template for trade in financial services. Conclusion A decade on from the start of the crisis, the G20 is building an efficient and resilient financial system which serves our domestic economies and supports sustainable cross-border investment and economic activity. As the global recovery strengthens and broadens, now is the time to take full advantage of these hard won gains. That means completing the journey from fragility to resilience by ensuring that: -  shadow banking is fully transformed into resilient market-based finance,  -  durable market infrastructure is in place,  -  we complete the job of ending too big to fail, and  -  emerging vulnerabilities are addressed in a timely and consistent manner. That means adjusting the reform measures dynamically to maximise efficient resilience and avoid unintended consequences. 11  The UK was an early adopter.
These are to be welcomed, provided the overall level of resilience is maintained. Resisting Fragmentation There are, however, other nascent risks that, if left unchecked, could threaten the progress made, and, ultimately undermine the G20’s objective for strong, sustainable and balanced growth. These risks include the impact of reform fatigue on implementation momentum, the outcome of Brexit negotiations, the need to complete Basel III, and the importance of finishing the job of ending too big to fail. In many respects, the global financial system is at a fork in the road. On one path, trust and cooperation diminishes, fragmentation hardens, capital flows are disrupted, and trade and innovation are curtailed. If authorities do not have sufficient confidence that their efforts to promote financial stability are being reciprocated elsewhere, then concerns about the risks of openness could intensify. If that happens, domestic authorities could impose local requirements on domestic entities of foreign firms. In a world where many banks and FMIs are highly interconnected that would generate significant inefficiencies, frustrating the benefits that flow from open trade and investment. Taking this low road would be sub-optimal for all, with fewer jobs, lower growth and higher domestic risks. 10  One example is a report by the Committee on the Global Financial System on the resilience of global repo markets that is being delivered to the G20 this week. 8  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  8  But there is another path: the high road.