Basel III
UK banks struggle in EU-wide stress tests
Italian banks also suffer heavy losses in EBA’s most severe test conducted to date; BoE says UK faced tougher test than others
RBNZ plans tougher discipline on banks’ regulatory breaches
Proposals would see major breaches linked to disclosure dashboard, highlighting when a bank has broken the rules
Basel Committee moots changes to leverage ratio
Regulation could be amended to mitigate central clearing impact; committee also critical of banks’ “window dressing” behaviour
Shift to internal models has increased largest EU banks’ risk – Finnish paper
Exposure to market risk of biggest European banks has grown over last 30 years, researchers find
Supervisory lessons: fault lines in prudential regulation
Former Bank of Spain head of supervision Aristóbulo de Juan highlights the lessons he has learnt about weaknesses in prudential regulation, in the second of a four-part series on supervision
Eurozone’s largest banks are penalised for intra-EU transactions – Praet
International regulations should recognised progress made under banking union, says senior ECB official
Banks tend to game stress tests, Fed economists say
Models tend to be subject to “strategic adjustments”, paper finds
Infrastructure financing not harmed by post-crisis reforms – FSB
First study of regulatory impact on intermediation finds infrastructure finance largely unscathed
Book notes: Unfinished business, by Tamim Bayoumi
Anand Sinha praises Bayoumi’s analysis of how the euro crisis and US housing crash were, in fact, intertwined
BoE to defend post-crisis regime through ‘running repairs’
Capital regime will need to evolve to stay on top of risks, says Victoria Saporta; BoE set to unveil details of operational resilience requirements
Miles warns too much weight placed on untried regulations
TLAC and the resolution regime may not be enough to substitute for higher capital, former Bank of England official says
Leverage ratio disincentives clearing – BoE paper
Leverage ratio appears to have made some banks less willing to take on new clients
Have central banks created a ‘debt trap’? No, but ...
Tougher regulation has helped ensure extraordinary monetary policy has not caused a dangerous rise in private debt
Regulatory efficiency or rollback?
Team USA’s new clarion call for regulatory “efficiency” comes with a worrying undertow, particularly related to regulatory rollback and ‘light-touch’ supervision of algorithms
The regulatory downpour
The Risk-based supervision focus report aims to offer assistance to financial regulators and supervisors in understanding the challenges that come hand in hand with evolution in the regulatory and supervisory environment. It explores how technology can…
US will implement trading book reforms, insists Fed official
“I don’t know why people doubt” US adoption, says Lynch
Andreas Dombret on ECB policy, deposit insurance and Basel III
The Deutsche Bundesbank executive board member speaks about exiting QE, the viability of European deposit insurance, the German banking system and doing a deal on Basel III
Basel’s Coen warns on complexity of market risk rules
Regulators may consider “simpler and more robust” approaches when finalising rules this year
Basel Committee adds ‘amber zone’ in market risk revamp
“Amber zone” will protect near-miss desks, but regulators not convinced by complaints on non-modellable risk factors
RBNZ deputy governor calls for move to ‘dual reporting’
“Sometimes unclear” how banks reach their risk weightings, Bascand says
Authorities need to deal with ‘limitations’ of global standards
The BIS’s Fernando Restoy says global standards do not cover all possible risks, and national supervisors need to fill in the gaps
Saudi Arabia’s Alkholifey on economic restructuring, reserves and cyber security
The Saudi Arabian Monetary Authority’s governor talks to Christopher Jeffery about the restructuring of the Saudi economy, the impact of low oil prices on reserves and anti-money laundering efforts
Interest rate risk could be seed of next crisis – economists
Financial markets may have underestimated the persistence of low rates, and regulations have amplified the threat, say Srichander Ramaswamy and Philip Turner
A dangerous unknown: interest rate risk in the financial system
Urgent action is needed to tackle the little-understood build-up of interest rate risk in the global financial system; macro-pru tools still inadequate to tackle the issue