Financial Stability
Rohde criticises Italy's calls for BRRD special treatment
Danish governor believes the forceful implementation of Europe’s new bank resolution rules represents a “game-changer”; laments Basel’s shift from risk-based regulation
French central bank reveals details of blockchain experiment
Banque de France teams up with a fintech start-up to run distributed ledger tech through Sepa; the results of project expected to be presented at a conference in 2017
FSB: Japan should strengthen financial stability framework
Latest peer review says Japan has work to do in improving the macro-prudential framework and clarifying approach to resolution
Yellen underlines the importance of education for the economy
Globalisation and technology are driving the demand for educated workers, Fed chair says, emphasising the important role education has to play in the evolving US economy
BoE paper experiments with measuring vulnerabilities
The study finds the US had highest levels of vulnerability in the run-up to the 2008 financial crisis, with Asia and Europe appearing “robust”; the picture has now reversed, authors say
European agencies see pitfalls in growing big data use
Financial products likely to become more tailored to consumers, but that will not benefit everyone, regulators warn
Ukraine nationalises country’s largest bank
Gontareva says PrivatBank failed repeatedly to take necessary action, and so will be transferred into public ownership; central bank creates emergency liquidity facility
ECB bulletin emphasises importance of monitoring uncertainty
Increases in uncertainty adversely impact the economy, research says, encouraging policymakers to introduce measures to mitigate its impact
US and EU outline final rules on loss-absorbency
Fed adopts final rule on loss-absorbency, while EBA makes final recommendations to European Commission; US rules include grandfathering and exceptions for foreign firms
Sharper distinction in household vulnerabilities needed – Poloz
Latest financial stability review stresses importance of understanding difference in risk in housing sector; household indebtedness and housing market imbalances are key concerns
Sarb fines two major commercial banks for AML breaches
“Administrative sanctions” placed on Societe Generale Johannesburg branch and Absa Bank after staff found “weaknesses” in AML and terrorist-financing control measures
RBI paper unpacks India’s non-performing loan troubles
Authors find bank risk-taking is procyclical and the level of non-performing loans responds to the interest rate environment and the overall growth of the economy
IMF delay forces National Bank of Ukraine to keep forex controls
Central bank to leave foreign exchange controls in place until political instability subsides and reforms are under way; IMF acknowledges progress, but says more is needed before the third review
BoJ and ECB collaborate on distributed ledger tech
The project will examine the possibility of running central bank infrastructure platforms in a DL environment; research will focus on payments and securities settlement
Book notes: Shadow banking in China, by Andrew Sheng and Ng Chow Soon
The authors dispel many myths about shadow banking in China – but may underestimate future risks, writes Michael Taylor
BoE’s Woods: firms favour ‘transitional’ Brexit period
Prudential Regulation Authority chief quizzed on best course of action for financial firms during Brexit process; “preferential” market access is not necessary, but seems sensible, he says
Task force launches climate disclosure recommendations
Mark Carney says better information will allow investors to “back their convictions with their capital”; Mary Schapiro says businesses will take the lead, even if politicians will not
Bank of Ireland’s Cronin spells out Brexit process for insurance firms
“Hearts and minds” have to be in Ireland, says director of insurance supervision; 2017 will reveal the “reality” of Brexit, she says
US agencies reject Wells Fargo resolution plan
Bank faces further curbs on its activities if it cannot present the Fed and FDIC with a sufficiently improved plan by early 2017
FCA urges progress on equivalency for derivatives trading
US and EU regulators should base recognition decisions on outcomes, not technical details
ECB backs EC plan to consolidate macro-prudential policy
Central bank says it should be handed new and clearer powers, while toolkit should go “beyond banking”
Eight banks struggle in Czech stress tests
Adverse scenario pushes many banks below regulatory capital minimums, though the system as a whole remains resilient, central bank says
Kganyago warns of ‘importing structural instability’
Sarb governor highlights impact of global banking regulation on South African economy, as Barclays prepares to pull out of the continent
BoE studies effects of capital requirements on balance sheets
After the financial crisis, banks placed more emphasis on asset deleveraging and adjusted their capital management practices