Speech by Brad Jones - ABA Conference - 17 June 2026

Why It Matters

The speech signals that escalating geopolitical risk will reshape capital flows, payment systems and compliance demands, forcing financial institutions and regulators to prioritize resilience and cross‑border coordination.

Key Takeaways

• Geopolitical tensions now directly threaten global financial system stability.
• Fragmentation appears in FDI, payments, and sanctions compliance.
• US dollar remains dominant despite narratives of its decline.
• Emerging cross-border payment networks challenge but don’t replace SWIFT.
• Regulators must address non‑financial risks like cyber, disinformation, sanctions evasion.

Summary

Brad Jones opened his ABA Conference address by warning that the international financial system, long insulated from geopolitics, now faces a far more perilous risk environment. He traced the evolution from the post‑World War II Bretton Woods order to today’s fragmented landscape, emphasizing that strategic uncertainty is reshaping capital flows, payment rails and sanctions regimes. He highlighted concrete evidence of fragmentation: geopolitically aligned countries are seeing higher foreign‑direct investment, while US‑China capital flows have slowed dramatically. Cross‑border payment initiatives such as China’s CIPS have surged, yet SWIFT remains the backbone for most transactions. Despite talk of a dollar demise, the greenback still underpins roughly 90% of FX trades and reserve holdings. Jones cited historical shocks – the four‑month closure of US and London exchanges in World I, the Bundesbank’s secret bunker, and cyber‑attacks on Estonia (2007) and the United States (2012) – to illustrate how geopolitical events can cripple markets and critical infrastructure. He warned that modern sanctions are proliferating, with over 120 countries imposing them in 2023, and that evasion tactics are becoming increasingly sophisticated. The implication for regulators and financial firms is clear: they must broaden risk frameworks beyond traditional credit and liquidity concerns to include cyber‑security, disinformation, foreign interference and sanctions compliance. Coordinated public‑private efforts and resilient payment architectures will be essential to weather future geopolitical shocks.

Original Description

In this speech to the Australian Banking Association, Assistant Governor (Financial System) Brad Jones discusses the relationship between geopolitical developments and the resilience of the global and Australian financial systems.