Financial Stability
Irish central bank’s consumer protection plan focuses on firms’ culture
Central Bank of Ireland unveils priorities for protecting consumers of financial services in 2016; focal points include firms’ culture, with more on-site inspections promised
Bailey to move to FCA by July regardless of EU vote
BoE deputy governor gives deadline for move to the FCA, where he will become chief executive; questioned on the risks surrounding the UK referendum
Low income households ‘highly’ vulnerable to changes in interest rates, paper shows
Banks and regulators require the use of ‘richer’ information to understand consumer debt, a Central Bank of Chile paper finds; new model would help evaluate economic policies
Esther George supports further rate rises unless outlook ‘significantly shifts’
Kansas City Fed president supports further rate rises unless economic outlook changes notably; normalisation justified by job increases and economic growth, she argues
DNB opens financial ‘whistleblowing desk’
Dedicated confidential contact points aim to make it easier to report malpractice, bank says
Negative commodity price shocks weaken EM financial sectors, IMF paper argues
The financial sectors of resource-rich emerging economies are vulnerable to negative commodity price shocks, working paper argues; better policy can increase resilience
Fischer spells out uncertainty surrounding impact of global volatility
Fischer says ‘modest overshoot’ of the longer-run unemployment rate would be appropriate, ahead of this month’s jobs data; sees benefit in maintaining balance sheet ‘for a time’
BoE paper suggests action when markets unsure about macro-prudential policy
BoE economists say policy-makers should be more active in times of uncertainty in the private sector, suggesting it need not make them "more cautious"
Former BoE officials warn low rates are feeding imbalances
Marian Bell and John Gieve say the Bank of England should start hiking rates soon, as signs of supply-side problems, unsustainable debt, rising house prices and inflation grow more serious
Some eurozone countries increasing ‘regulatory fragmentation’, Lautenschläger says
‘Regulatory fragmentation’ between eurozone nations’ banking supervision regimes is being increased in some cases, Sabine Lautenschläger argues
Chance to ‘review’ BRRD must be seized, says Visco
Italian governor criticises the application of the Bank Resolution and Recovery Directive (BRRD); the transition was too hasty and reform may be needed, he argues
Irish credit unions still face challenges, regulator says
Ireland’s credit union sector faces ‘significant challenges’ despite recent improvements, with numbers of institutions under loan restrictions ‘far too high’, central bank regulator says
‘Decarbonisation’ could allow investors to hedge climate risks, economists say
Economists claim low-carbon index can deliver similar performance to benchmark indexes while hedging the uncertain timing of climate change policy-making
Responses to commodity shocks only have ‘small’ impact on investment, paper finds
Flexible inflation-targeting frameworks and exchange rates are ‘essential’ to limit the macroeconomic impact of commodity price volatility
Bank of Russia holds after oil prices enter ‘risk scenario’
The falling oil price puts Russia at increased risk of recession while inflationary pressures grow, the Bank of Russia says, as it keeps its policy rate unchanged
Floating exchange rate has led to more volatility, Norwegian paper says
Moving to inflation targeting regime prompted rise in volatility in nominal exchange rates, research says; no depreciation or appreciation trends evident, however
Severely adverse scenario will now include ‘more severe downturn’ for US
Severely adverse scenario will now include ‘more severe downturn’ in the US economy; two new BHCs will take part, bringing total number to 33
BoE reveals final element of ring-fencing framework
Systemic risk buffer will apply to ring-fenced assets, with the aim of preventing banks amplifying stress; BoE also hopes it will give smaller banks a competitive boost
Haircuts on sovereign debt ‘open the door for more leverage’, research finds
Prolonged low interest rates also contribute to an overleveraged economy in case of crisis; though in times of ‘low crisis’ they can help decelerate fiscal adjustment
BIS paper finds investors take simplistic approach to emerging market risks
Authors find investors seem to divide countries based not on fundamentals but on whether they are deemed an emerging market
BoE’s Woods says Solvency II not a revolution
Executive director at the Bank of England examines historical changes in insurance regulation, concluding the introduction of Solvency II is in line with existing philosophy
Parliamentary enquiry criticises Irish central bank
The Central Bank of Ireland failed to address issues in the country’s banking sector with its ‘light touch’ regulation, an Irish parliamentary report finds
Bank of England prepares to overhaul ageing RTGS system
Central bank will spend year outlining plans for replacement to high-value payments system, keeping an open mind at present as to what features it should have