Banking
Indonesia moots new rule to boost bank lending
Bank Indonesia to propose range of loan-to-deposit ratios to encourage lending; banks prefer to park deposits in money market due to perceived default risk
JP Morgan slashes commodity desks
Fate of other prop desks unclear ahead of enactment of Volcker Rule
Core principles mostly apply to micro lenders: Basel Committee
Basel Committee on Banking Supervision issues final report on applying core principles to microfinance providers; tweaks needed on credit risk, capital adequacy and risk management
Banks’ role to be reduced in future financial system, IMF says
IMF position note says non-bank financial firms will see roles expand; IMF must refine its methods and broaden its view to keep up with changes
Basel Committee defends adjustments to Basel III as calibration decisions loom
Regulators describe difficulties ahead as they prepare for Basel III calibration and transition decisions in September
New Basel proposals threaten bank sub debt, investors warn
Bond investors voice concerns over freedom given to national regulators to determine trigger events for conversions or haircuts
UK FSA revisits trading regulation in comprehensive review
Financial Services Authority identifies valuation, capital framework coherence and risk management as key problem areas; issues 15 recommendations to revitalise standards
Basel bids to make bondholders pay price of failure
Basel Committee on Banking Supervision says all instruments classified as tier one and tier two capital bear some of the cost of taxpayer support
Canada throws weight behind Basel III, lauding output gains
Bank of Canada says forthcoming capital and liquidity ratios will save the country nearly C$200 billion; stresses that Canada must not rest on laurels, not having experienced banking crisis
Banks overestimate Basel III’s impact on growth: regulators
Basel body says hiking capital ratios by one percentage point will only cause 0.19% drop in potential GDP as lower rates will cushion the blow; industry bodies remain unconvinced
Zambia’s Fundanga: cost of capital still too high
Bank loans within the reach of the masses, but interest rates remain prohibitively high
Washington begins writing out reliance on ratings agencies
Federal Reserve, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency and Office of Thrift Supervision begin search for new measure of creditworthiness
ECB flags concerns over new capital rules
New capital rules may incentivise banks to dump risky assets on central bank
Basel III watered down by politics and not fit for purpose, says CLSA risk chief
The most recent draft of the Basel III proposals has been watered down by politics, according to an Asian risk officer
New Zealand mulls lightening banks’ reporting load
Reserve Bank of New Zealand seeks to remove doubling in reporting requirements and bring standards for Kiwi banks in line with international practice; mooted changes expected to reduce compliance cost
Singapore slaps biggest bank with extra capital requirements after technical glitch
Monetary Authority of Singapore censures DBS and imposes additional capital requirements after technical failure caused bank’s services to shut down in July; fault pinned on poor risk oversight
Northern Rock’s bad bank posts first profit
Northern Rock Asset Management shows $267m profit for first half of year as split with so-called “good bank” lowers costs of funding; FSA slaps RBS with $9m fine for screening failures
Basel III features win governors' seal of approval
Group of Governors and Heads of Supervision, which oversees Basel Committee, okays parts of forthcoming Basel III proposals; calibration and phase-in arrangements to be finalised in September
Westminster spells out Bank’s importance in new regulatory structure
Bank-led committee will instruct prudential regulator and consumer body on policy; Treasury asks industry players for input on broadening new body’s objectives
Key Basel III decisions due as oversight board gathers
Governors and heads of supervision will review recommendations brought forward from July 14-15 Basel Committee meeting
ECB insists stress tests are credible
ECB denies claims stress test scenarios were not severe enough
Maiden Lane chief to head NY Fed banking supervision from 2011
New York Fed’s Sarah Dahlgren to replace William Rutledge as head of supervision; Rutledge to retire in December
Dodd-Frank starts to bite as Obama signs bill into law
US President Barack Obama draws a line under year-long legislative process, hailing bill’s benefits to consumers; ratings agencies flustered by exposure to ‘expert liability’
Volcker philosophical on weakened rule, reform bill
Former Fed chairman Paul Volcker says failure to include dollar limit on banks’ positions in hedge funds “disappointing”, but accepts need for political compromise