Financial Stability
ECB gives green light to Italian recapitalisation law
ECB raises no objection to decree but other obstacles may remain
BoE paper calls for international standards on 'broader co-ordination'
Credit growth in the rest of the world has a large positive effect on the probability of domestic banking crises
RBA to ‘pay close attention’ to housing market in 2017 – Lowe
Rent growth remains weak but vacancy rates are not high, RBA governor says; households and banks are currently taking the right approach to the environment
UK’s PRA fines Japanese banking group for withholding information
Two arms of banking giant MUFG fall “significantly short” of regulators’ expectations, resulting in fines totalling £26.8m
BoE’s Cunliffe sheds light on investment issues
One in five firms report constraints on credit access reduced investment, BoE deputy says, while restrictions on internal fund usage have worsened the problem
Staff incentive schemes lead to bad deals for consumers – paper
Colombian paper examines the effect of bank incentive schemes on consumers; transparency index reveals staff often do not disclose information about the price of financial products
Future of Greek austerity divides IMF board
Some directors dissent from call to reduce mid-term primary surplus target
Banque de France paper models ‘pandemic’ impact of shocks
Researchers build on other recent models of financial markets
Some credit unions don’t vet senior staff – Irish central bank
“Fitness and probity” requirements are not being followed by all unions, the report says
Draghi: eurozone ‘bad bank’ would not be ‘panacea’ for NPLs
ECB president also rejects criticisms made by the US president’s trade adviser
Capital account management could prevent ‘commodity curse’, BIS paper shows
Authors suggest options for small open economies dealing with commodity booms; solutions could prevent reductions in welfare and support the tradable sector
Fed unveils stress scenarios under revised testing approach
Tests now include model enhancements, new phase-in methods and lighter requirements for some banks; the severe scenario has been turned up a notch
Macro-prudential spillovers may grow, paper argues
Bundesbank paper uses IBRN data to analyse cross-border effects of policy
Ingves sees cross-border resolution lessons from Swedish crisis
Crisis in the early 1990s prompted Swedish authorities to take early action on cross-border resolution, the Riksbank governor says
Esma sets out 2017 work programme
Strategy and governance among key priorities, Maijoor says
African regulators want regional regulatory structure – Basant Roi
“Political will” to support financial regulatory reform in Africa is “missing”, says Mauritius governor; IMF chief says resolution frameworks are “insufficient”
Some G20 initiatives have harmed EMs, says Mminele
Reforms have led to G-Sibs reassessing their business models, leading to a rise in de-risking, says Sarb deputy; Africa is seeing a “pronounced decline” in correspondent banking
FSB issues draft guidance on CCP resolution
Regulators’ powers should include “bail-in” and “full tear-ups”, FSB recommends; regulators should have resolution plans for all systemically important CCPs, including cross-border provisions
Draghi examines financial integration through a digital lens
Digitalisation will help with financial integration, but beware of the risks, says Draghi; fintech is high on the ECB’s strategic agenda
UK financial regulators finalise plans to strengthen enforcement and transparency
PRA and FCA publish measures that will keep financial firms better informed about investigations; new framework will “command public confidence”
Basel capital floors are necessary – Riksbank’s af Jochnick
Internal models have led to doubts over true capital adequacy, Riksbank deputy says, so floors have an important role to play
Global financial safety net hits snag in regional finance
Jeromin Zettelmeyer warns moral hazard problems are now more serious with the rise of regional funds; central bank swap lines could be a partial solution
El Salvador governor highlights benefits of increasing minimum wage
New minimum wage legislation will improve the living standards of 19.9% of households, says El Salvador governor; raise will also have positive impact on total economic growth
Irish central bank to survey credit unions’ controls
Central bank has “concerns” over quality of some institutions’ systems, deputy registrar says