Financial Stability
Investors to sue Portuguese central bank over asset writedown
A group of bondholders in a failed bank are bringing a lawsuit against the Portuguese central bank over its writedown of their holdings in a failed commercial bank
Coen looks to wider issues affecting bank resilience
Secretary general of Basel Committee highlights importance of corporate governance and culture, IT systems and stress tests for resilience and profitability
Fiji central bank will launch second financial inclusion strategy ‘shortly’
Second financial inclusion strategy to place “special emphasis” on insurance; governor praises success of first scheme in meeting targets, but 27% of population remains unbanked
Seychelles central bank will chair new financial stability committee
Advisory body will comprise representatives from four different public bodies and meet on a quarterly basis; supported by new financial stability unit within central bank
Malaysian deputy tells companies to provide ‘more than just a payment solution’
Muhammad bin Ibrahim stresses importance of financial institutions providing “value-added services” to their customers if they are to remain competitive
Fibre optics raise concentration of forex trading - paper
Barry Eichengreen and co-authors find technological gains from submarine fibre optic cables helped increase the concentration of foreign exchange trading
Tax system severely reduces Italian banks’ profits – paper
Disparities in eurozone countries’ effective tax rates for their banking sectors may threaten banks’ ability to strengthen their capital, a Bank of Italy paper argues
Basel Committee flags further issues with bank modelling
Second study of variation in credit risk modelling using internal ratings-based approach sheds further light on what is causing banks to calculate significantly different capital requirements
FRTB data standards seen as threat to emerging markets
Need for "real" prices will limit use of models, increasing capital burden
Policy-makers could use fraud patterns as economic indicator – paper
Positive relationship exists between bank fraud and the macroeconomy, Chicago Fed risk specialist finds, suggesting fraud could offer an early warning sign of crisis
FSB intrigued by potential uses of distributed ledgers
Mark Carney says FSB members see ‘exciting opportunities’ in financial technology, including the potential for distributed ledgers to bring security and efficiency
Italian firms' leverage well above average, study finds
Italian non-financial companies’ leverage ratios are significantly above the eurozone average, a working paper shows
Chinese and Czech central bank enlarge MoU to include crisis management
Czech National Bank and China’s banking regulator have deepened their existing memorandum of understanding to include working together on crisis-hit banks, Czech governor says
Fed picks McKinsey to scrutinise faster payment proposals
Consultancy firm will assess options for a real-time system across the US, as task force members are invited to submit proposals
BoE moves to tighten buy-to-let standards as risks rise
Review of buy-to-let lending finds some firms may be relying on weaker underwriting standards than others; FPC warns UK financial stability outlook has worsened since last meeting
ECB clarifies national supervisory discretions
European Central Bank publishes a guide and regulation aimed at harmonising supervision of major banks within the eurozone
Reformed IMF could strengthen global safety net – paper
Improving the International Monetary Fund may require revised toolkit; global financial safety net is failing in many regards, and needs reform, IMF policy paper says
Mauritius has gone ‘terribly wrong’ with respect to human capital, central bank governor says
Quality of human capital does not met the standard required to meet the disruptive challenges now facing Mauritius, governor Roi stresses
Some analysts see stress tests losing effectiveness – Stournaras
Greek central bank governor raises questions over perception of stress tests; regulators’ models need to take more account of national differences, he argues