Europe
EU survey calls for more cohesion on cloud computing
There appears to be a lack of clear and formal guidance from financial supervisors on banks’ use of cloud-based IT services, while their use is underestimated, an EU agency says
Carney says reciprocity ‘central feature’ in ESRB framework for spillovers
ESRB analysis shows domestic policies can be more effective if their spillovers are managed; Carney says framework for doing so will be operational ‘early next year’
French and German central banks cut inflation projections for next two years
Falling energy prices main factor in downward revision of German and French central banks’ projected inflation rates for 2016 and 2017
Shift to single currency increased volatility of money growth, paper argues
The shift to European monetary union had a major impact on the volatility of money growth rates in the eurozone, a working paper from the Banque de France argues
Domestic euro users bear highest shoe leather costs, Bank of Italy paper finds
Euros circulate widely outside the eurozone, transferring some costs to foreigners – but the effect is small relative to the popularity of the euro as a global currency
ECB survey finds ‘access to finance’ least of eurozone SME problems
The European Central Bank’s survey of eurozone enterprises finds deleveraging is continuing at a slow pace while few firms rate lack of access to finance as their major problem
New Dutch deposit guarantee scheme should ‘disincentivise risk-taking’ by banks
The Netherlands Bank has introduced a new deposit guarantee scheme; scope is wider than old scheme and risk-based, ex ante funding structure aims to dis-incentivise risk-taking by banks
ECB should not expand QE programme in December, Lautenschläger says
Sabine Lautenschläger tells German audience ECB’s loose monetary policy is necessary but asset purchases should not be expanded; only structural reform will bring about European recovery
Bundesbank calls for harmonisation in CMU response
The Deutsche Bundesbank responds to the European Commission’s capital markets union proposals, calling for greater harmonisation and transparency but warning of burden
Policy-makers must drop ‘obsession’ with competitiveness, Cœuré says
Policy-makers must drop their ‘obsession’ with competitiveness and focus on increasing productivity instead, Benoît Cœuré says; researchers need to question assumptions of ‘conventional’ theory
EBA: European bank capital improving but concerns remain over profits and assets
European banks are improving their capital and leverage ratios but are suffering from low levels of profitability and problems with non-performing loans, transparency exercise finds
EC plans full eurozone deposit insurance by 2024
Proposals outline gradual introduction of common deposit insurance in the eurozone between 2017 and 2024; size of fund equivalent to 0.8% of covered deposits, estimated at €43bn
Eurozone banks face 'in-depth' scrutiny of risk handling, Nouy says
Banks’ handling of risk is being subjected to in-depth analysis by the ECB’s single supervisory mechanism, Danièle Nouy says
Central bankers must research QE’s effects on inequality, Italian deputy governor says
Central banks must improve their understanding of how expansionary monetary policy affects inequality in developed economies, says Fabio Panetta
Terror attacks may have made European capital revival harder, Visco says
Terror attacks may hinder revival of European Union’s rate of capital accumulation, Ignazio Visco tells audience in Paris; capital market reforms present tough long-term challenges
ECB’s Mersch explores construction of instant payments services
Yves Mersch says Eurosystem envisages services being constructed on scheme, clearing, and settlement layers, and considers challenges involved in each
Honohan sets out virtues of new crisis tools in final speech
Irish governor stresses potential of direct recapitalisation and GDP-linked loans to help bolster debt sustainability in crisis-hit countries; expects successor Lane to come in with ‘big broom’
Cyprus must make NPLs ‘number one priority’, international agencies say
Authorities must properly implement proposed loan reforms, joint statement says
Mersch considers unintended consequences of regulation
Eurozone policy-makers must be careful that their efforts to reform the financial sector do not create ‘new externalities’ risks for banks, says Yves Mersch of the ECB’s executive board
ECB aims for single policy on ‘options and discretions’ with new proposals
Central bank publishes draft documents aiming to create a single policy for the exercise of options and discretions under banking law in financial systems it regulates
Low rates from QE poses risks to some pension and insurance firms in eurozone, Visco warns
Pension funds and insurance companies in some eurozone countries may need to adjust their practices to limit the risks arising from asset purchases, Italian governor says
ECB publishes first quarterly statistical report on households
The European Central Bank publishes its first quarterly statistical report on the eurozone’s household sector; underlying figures available online in data warehouse
‘Closed’ nature of eurozone banks increases vulnerability, Portuguese paper says
Commercial banks in the eurozone are more likely to be hit by country-specific shocks compared to US given fewer foreign branches; greater use of asset-backed securities may be a solution
Europe lags US in leading global financial reform, economist says at ECB event
The European Union no longer leads global efforts at financial reform, argues French economist Nicolas Véron; eurozone nations have too many seats on global reform bodies, he adds