Financial Stability
CGFS pushes central banks to prepare market-making crisis measures
BIS committee warns of ‘bifurcated’ liquidity and suggests central banks prepare crisis measures to support market-making, including the potential for direct intervention in critical markets
Basel rate-risk project sets up scrap over deposit models
Attempts to set international capital rules for banking book interest rate exposures are hitting sensitive ground as banks warn lending will suffer if regulators cap deposit maturities
Dudley endures grilling on Goldman tapes
New York Fed president questioned by senate committee, including whether the culture at the Fed itself is up to scratch; Dudley contests claim NY Fed failed in supervisory duties
Central Bank of Ecuador trials mobile payments
A group of 800 people are testing the platform as part of pilot program; Central Bank of Ecuador hopes to tackle financial inclusion with the new technology
BoE’s Taylor defends complexity of leverage ratio plans
External FPC member says countercyclical leverage ratio may be more complex than a flat rate, but allows the Bank of England to be less heavy-handed with the rule and avoid perverse incentives
Draghi sets sights on capital markets at SSM inauguration
Mario Draghi says policy-makers can draw on new model for banking supervision when working to integrate capital markets; Danièle Nouy calls for consistent regulation across countries
New Zealand’s banknotes get first upgrade since 1999
Reserve Bank unveils a ‘brighter, more modern look’ for its banknotes, and a host of new security features; net cost will be NZ$40 million over five years
BIS' William Coen on Basel III and preventing the next crisis
William Coen, the secretary-general of the Basel Committee, speaks about the banking industry’s response to Basel III, supervision versus regulation and preventing the next crisis.
Book notes: What Have We learned? Macroeconomic Policy After the Crisis, by George Akerlof, Olivier Blanchard, David Romer and Joseph Stiglitz
This book brings together the great and the good of the economics profession, policy-makers and academics, to assess what the dust jacket describes as the “brave new economic world"
Linde: Spanish banks have ‘solid solvency position’
Bank of Spain governor says performance of Spanish banks during ECB stress tests was ‘positive’; banks face the future in a ‘solid solvency position’
BIS paper warns Basel III likely to prove ‘challenging’ for emerging markets
Working paper points to a number of obstacles to implementing the Basel framework in emerging markets and developing economies, and suggests potential solutions
Robert Pringle’s Viewpoint: Time to cure central bankers’ deflation phobia
The policies followed since the ‘great crisis’ have not succeeded in restoring confidence. It is time to try a different approach
Riksbank paper examines impact of systematic bailout guarantees on bank co-ordination
Bailout regime increases expected profits from co-ordination and raises probability of competitors remaining in business, researchers argue
Eurasian central bank cooperation taken up a notch
Armenia and Kyrgyzstan attend ‘advisory council’ on foreign exchange policy for first time; meeting held in wake of Bank of Russia’s decision to let the ruble float
Bundesbank’s Nagel wants Frankfurt clearing house
Executive board member details benefits to German economy from having an RMB clearing bank, and sets out plans to form a clearing house in the future
BIS paper finds leverage ratio more countercyclical than other capital ratios
Working paper finds evidence the leverage ratio is ‘significantly’ more countercyclical than ratios of capital to risk-weighted assets, although the effect is less powerful during crises
Mauritian governor predicts banking overhaul by 2035
Rundheersing Bheenick sees mobile technology taking centre stage in years to come and banks reducing staff as a result; describes inequality as a ‘time bomb’ facing the economy
G-20 summit delivers agreement on TLAC
Leaders approve standard for total loss-absorbing capacity, but consensus on cross-border cooperation remains hazy; Carney looks ahead to next phase of reforms
BIS' Caruana warns a debt trap 'looms large'
BIS general manager laments lack of analytical framework for dealing with ‘interplay' between finance and the real economy
RBA strikes clearing deal with PBoC
Australian authorities agree clearing arrangements and RQFII quota with Chinese counterparts; announced in wake of G-20 summit and follows similar Canadian deals
Argentina enjoys a rare period of ‘currency peace’
Peso sees a recovery in the black market after the central bank cracks down; economists suggest a boost in dollar reserves is the main reason for the appreciation
G-20 Brisbane Summit: What to look for
Leaders of the G-20 countries meet this weekend to try to thrash out a deal on financial stability, growth and employment; Central Banking looks at some of the main issues on the table
Bank of Portugal looks set to audit banks' conduct
Central bank is expected to focus on banks’ governance models during the exercises, in an effort to prevent the issues associated with BES from resurfacing elsewhere
Payments technology progressing in ‘leaps and bounds,' says Canada deputy
Carolyn Wilkins says Bank of Canada is keeping a close eye on risks posed by new forms of electronic money and modernising its oversight framework for payments