Banks
BoE’s Tenreyro sees hopeful signs for UK productivity
Many factors dragging on productivity may soon start to fade, MPC member says, though the UK seems to be missing out on a global investment boom
Core-periphery model of bank networks called into question
Researchers find multiple cores in the interbank market, posing different systemic risks
BoE’s Woods warns of ‘point of tension’ in Brexit negotiations
PRA chief fears EU supervisors may adopt a local mindset when dealing with cross-border firms
Economists need to better understand macrofinancial links – BIS paper
Stijn Claessens and Ayhan Kose call for “new generation of models” among other research to solve ongoing puzzles
Banking ‘deserts’ do not explain financial exclusion – NY Fed economists
Data shows absence of nearby banks fails to explain “unbanked” share of the population
Home truths on Europe’s NPLs
Europe needs to overcome fears of a hypothetical crisis, and impose more intrusive supervision and greater provisioning on its banks
Gontareva accused of complicity in money laundering
Ex-governor denies she improperly helped former president Yanukovych
HKMA launches consultation on open API framework
Open API enables personalised services for bank users but requires access to customer data
IMF’s Obstfeld: effects of accommodative policy remain unclear
The IMF chief economist weighs up the productivity puzzle and whether monetary policy helped or hindered growth following the financial crisis
PBoC tightens bond trading rules, relaxes renminbi controls
China’s financial regulators continue their efforts to deleverage the economy and promote renminbi internationalisation
‘Decisive’ action needed to deflate China’s credit boom – IMF paper
Lack of reliance on foreign financing, low government debt, and state control help to mitigate effects of credit boom, but buffers should not be relied upon in the long run
Book notes: The End of Theory, by Richard Bookstaber
Bookstaber provides an entertaining introduction to agent-based modelling – a potential new front for economics
BIS paper asks what makes emerging market banks profitable
Both bank-specific and economy-wide factors affect banks’ profitability, authors find
Fed proposes expanding risk regime to foreign subsidiaries
New consultation suggests widening the scope of the August 2017 proposals to foreign-owned operations
Colombian paper says resolution co-operation is needed in the region
Authors examine how resolution plans have evolved and conclude more work can be done with regard to local systemically important financial institutions and cross-border activities
BIS issues new ‘streamlined’ stress test principles
Banks have made significant advances in stress testing since financial crisis, Basel Committee says; issues new ‘guidelines’ that focus on stress test evolution
Patrick Njoroge on reshaping banking and finance to work for the masses
The Central Bank of Kenya governor speaks to Christopher Jeffery and Rachael King about exchange rate intervention, food prices, banking reform and financial inclusion
Libya’s eastern administration elects new central bank governor
Mohamed al-Shukri, former vice-governor under Gaddafi, is elected by the House of Representatives; the move casts doubt on PM’s unification plans
Danish central bank dismisses central bank digital currency
Digital instrument would not make current payment system more efficient, says report, adding introducing such a currency would pit the central bank against commercial institutions
Some banks’ living wills have ‘shortcomings’ – US agencies
The latest assessment finds previous “deficiencies” have been corrected, but four banks show less serious “shortcomings”
Sarb closes branches to optimise cash management
Inefficiencies prompt central bank to close three of its branches, while remaining three are ‘converted’ into cash centres
BoE sets out post-Brexit supervision plans
Central bank says UK will aim to stay open as banks, insurers and CCPs are brought under the PRA’s oversight; changes imply heavy workload for the supervisor
One big bank falls short of ECB’s capital requirements
One bank falls short and a second comes close, although five banks failed the test in 2016
Bank Negara Malaysia issues new digital currency regulation
Proposed regulation aims to hold digital exchanges to a higher standard of transparency, while ensuring they identify any AML/CFT risks that may arise