Financial Stability
ECB: monetary policy could have prevented the crisis
European Central Bank study finds low benchmark rate had significant role in lax lending standards before crisis
BIS’s Cecchetti on benefits of phasing in Basel III
Bank for International Settlements economic adviser Stephen Cecchetti says stronger capital requirements will be easier to swallow if phased in with new ratios
RBNZ, NZX ink MoU on connected clearing system
Reserve Bank of New Zealand agrees with Wellington-based stock exchange on separate but connected clearing and settlements systems
T&T solves remittances anomaly
Central Bank of Trinidad and Tobago study explains drop in remittances to developing world
BoK’s Kim: Asia needs stronger domestic demand
Bank of Korea governor Kim Choongsoo says domestic demand can aid structural imbalances in Asia
Czech National Bank withdraws smallest banknote
Czech National Bank says Kc50 note will be replaced with coin in April; cites cost of replacing notes and change in value
Irish bonds sixth riskiest: report
Credit default swap spreads on Irish bonds spike more than any other in third quarter; Portugal also among ten riskiest sovereign issuers
Bank of Canada: central banks prefer higher haircuts
Bank of Canada study shows haircuts on collateralised assets is greater when central banks cannot lend exclusively to illiquid institutions
RBA’s Ellis warns of complacency over new Basel rules
Reserve Bank of Australia head of financial stability Luci Ellis calls for diligent policing of financial markets; says Basel rules are insufficient protection
Ireland’s Elderfield rules out senior debt haircuts
Holders of senior debt must not be forced to shoulder losses, but issuing banks could negotiate with them, says Central Bank of Ireland’s Matthew Elderfield
Recovery has lost steam and risks remain high, IMF warns
IMF's latest financial stability report strikes a cautionary note about the stalled economic recovery
BoJ: low interest rates boost bank lending
Bank of Japan Economic and Financial Developments report says bank lending showing signs of improvement
US Treasury slashes forecast for cost of Tarp
US Treasury estimates cost of government bailout at $30 billion, less than a tenth of original forecast
Brussels crafts principles for bank account access
European Commission consults on principles to ground law granting universal access to basic bank accounts; 6% of adults do not have a bank account
Anglo bailout prompts Ireland downgrade
Fitch knocks Irish debt one notch; says higher bailout cost will impair fiscal consolidation plans
IMF: Gulf bank balance sheets severely impaired by economic downturn
Fund study finds link between economic conditions in Gulf states and banks’ nonperforming loans in region
Paper problems delay release of new $100 note
Federal Reserve says sporadic creasing of paper on new banknote will setback release of new $100 bill
Swiss to make UBS and Credit Suisse pay for systemic status
Swiss commission proposal beefs up Basel III for Credit Suisse and UBS with 19% capital requirement and other measures to tackle 'too big to fail' problem
Bank of Spain's Roldán highlights Basel III flaws
Basel III’s architecture, hybrid capital and liquidity buffers among potential pitfalls; views shared by BaFin's Sanio
BaFin's Sanio: no fix for cross-border failure
Jochen Sanio says supervisors nowhere near to solving “key issue” highlighted by crisis; flags lack of communication on Lehman Brothers
González-Páramo: macroprudential policy implementation a work in progress
European Central Bank executive board member José Manuel González-Páramo says policymakers must understand full effects of macroprudential policies
Australian banks demonstrate resilience says RBA
Reserve Bank of Australia Financial Stability Review shows improvement in banking sector as bank profitability returns to pre-crisis levels
Basel II grievances stir transatlantic tensions on new accord
BNP Paribas chairman Michel Pébereau slams United States’ failure to implement Basel II across the board; says Basel III will unfairly impair Europe
Weber, Blankfein praise Basel III leverage cap
Bundesbank president Axel Weber and Goldman Sachs chairman Lloyd Blankfein laud Basel III’s inclusion of leverage ratio, as opposition mounts