European Central Bank (ECB)
Macro-prudential policy must give guidance on how to deleverage, paper says
Different deleveraging methods have varying effects on the economy, ECB working paper finds; policy-makers must give banks concrete guidance on how they implement certain measures
TLTRO II may reflect renewed ECB focus on transmission, analysts say
The European Central Bank’s decision to operate a second targeted long-term refinancing operation would help provide banks with ‘stability’, according to Draghi
ECB launches ‘comprehensive package’ as inflation outlook worsens
Mario Draghi announces cuts in interest rates and an expansion to the ECB’s asset-purchase programme, as well as a second TLTRO package, larger than the original
European supervisors must improve consistency on capital requirements, Angeloni says
European regulators must take more consistent approach to capital requirements, Ignazio Angeloni says; authorities have to improve macro-prudential policy co-ordination
Institutions agree to mission to check on Greek reforms
Representatives of European and international institutions have agreed to send a team to Athens to check on reform progress; visit is necessary to allow bail-out to continue
Networks did not spread 2008 shocks in eurozone money market, paper argues
Banking networks in the eurozone did not play a major role in spreading shocks in the financial crisis, ECB working paper argues; eurozone banks are ‘not network dependent’
Lautenschläger says some leveraged finance practices need watching
ECB’s head of supervision notes increase in ‘covenant-lite’ deals
Wholesale funding shocks hit credit supply, paper finds
Shocks to securities and interbank lending markets have significant effects on banks’ supply of credit, an ECB paper finds; researchers use monthly loan data for eurozone banks
Greek governor calls for ‘bold and innovative’ action on non-performing loans
Greek economy should start a modest recovery in the second half of 2016, but the government must hit bailout programme targets and take bold action on non-performing loans, governor says
Eurozone sovereign debt crisis has increased financial fragmentation, paper argues
Eurozone corporate bonds have different risk premia according to which country a company is headquartered in, paper argues; fragmentation has ‘dampened effectiveness’ of ECB policy
Sarb’s Lesetja Kganyago on divergent monetary policies and new supervision
The governor of the South African Reserve Bank talks to Christopher Jeffery about navigating divergent monetary policies, South Africa’s new supervisory regime and nurturing new talent
EBA unveils 2016 stress test methodology
European Banking Authority presents the methodology for 2016 stress tests; no single capital adequacy level, but results will inform regulators’ assessments under SREP
Small and medium eurozone banks must assess business models, Lautenschläger says
Smaller financial institutions need to examine their business models in detail, eurozone regulator says; SSM wants harmonised treatment of institutional protection schemes
Eurozone banks are taking more risks, Nouy says
Falling profitability of banks in the eurozone is pushing institutions into ‘into riskier territory’ and driving risk premia to historic lows, Nouy says; warns against ‘inappropriate cost-cutting’
ECB’s liquidity provision had ‘highly uneven effects’ on interbank markets, paper argues
ECB emergency liquidity provision had very different effects on stressed and non-stressed interbank lending markets; paper reconstructs interbank lending from Target2 database
ECB costs and profits on the rise, annual accounts show
Net profit for the ECB rose in 2015 year on year due to higher gains from securities sales and more fees charged for supervisory activities; operating costs also rise due to staff increases
ECB governing council minutes stress need for good communication
Members of the ECB’s Governing Council agreed on the need for good communications but disagreed over the evidence of second-round effects in recent wage dynamics, minutes show
German constitutional court to rule on OMT ‘in a few months’
Germany’s constitutional court is reviewing the European Central Bank’s outright monetary transactions and their application under German law; decision expected 'in a few months'
Nouy says increase in European banking spreads not ‘justified’
Recent rise in credit spreads for eurozone banks does not appear justified, given their high capital levels, Danièle Nouy tells the European parliament
‘No Basel IV’, Draghi tells European Parliament
Banks will not face significantly higher capital requirements, Mario Draghi tells the Econ committee; UK agreement with rest of EU should be “clear”
ECB chooses SIA-Colt partnership for T2S connection
European Central Bank confirms it will use SIA and Colt's 'value-added network services' to connect to Target2-securities
ECB ‘actively considering’ whether to scrap €500 note, Cœuré says
Executive board member says he finds arguments in favour of keeping highest denomination note ‘less and less convincing’, as evidence mounts of its role in corruption and crime
People: Mozambique deputy moves to airline; Mervyn King joins Aston Villa FC board
Bank of Mozambique deputy moved from central bank to national airline; former BoE governor joins premier league team board of directors; and more
Research compares borrower-based macro-pru tools
Debt service-to-income caps generate ‘less pronounced macro feedback’ in the short term than loan-to-value limits, working paper finds