Financial crisis
Fed paper constructs ‘loan frontier’ for mortgages
Method mimics literature on estimating production frontiers, allowing authors to study credit provision around the 2008 crisis
BoE asks banks to allocate $154 billion to new MREL requirements
UK central bank introduces new internal capital requirement for large banks with subsidiaries; banks have net shortfall of £4 billion to meet by 2022
Fixing the banks is not enough – Adair Turner
Robust banks can supply credit but the real damage from financial crisis is caused by lack of credit demand, former FSA chief says
John Williams on the neutral rate of interest and mandate change
The president of the Federal Reserve Bank of San Francisco speaks about the plunge in the natural rate of interest, and why it means central banks should work together to review their price stability targets
Portuguese governor clashes with government
Treasury intends to transfer banking resolution competencies out of the central bank
BoE issues consumer credit warning to banks
Preliminary stress-test results show UK banking system could incur £30bn loss over three years; UK central bank says financial system is “underestimating losses”
‘Fault lines’ may be re-emerging, warns Bini Smaghi
Societe Generale chairman says supervisors should not rest easy until they have a better understanding of the “fundamental causes” of financial crises
RBNZ proposes tougher rules for bank outsourcing
Banks must show they can open at 9am the day after entering resolution; foreign-owned banks need to supply separation plans
BoE economist discusses danger of ‘virtual’ bank run
Faster payments and rise of smartphone technology have made it possible for consumers to drain commercial banks without having to leave their homes, official says
Spanish ex-governor will not face charges over Bankia case
Former IMF managing director will face charges over collapse of Spanish commercial bank
Ugandan stress tests reveal banking sector vulnerabilities
Banking sector could face a loss of $140 million if three largest banks default; governor says it has been a “difficult year” for banks
Sovereign debt crises hit non-tradable sectors harder
A 1% increase in bond spreads is associated with an average decline of 3% in growth of zero-traded industries
Lower monthly quotas effective at preventing mortgage defaults
60% of US defaults during financial crisis caused by lack of ability to pay, paper finds
Leading asset manager warns policy normalisation ‘may never occur’
Northern Trust believes monetary policy is unlikely to revert to pre-crisis levels; observers say central banks are broadly taking the right approach
IMF report studies country responses to volatile capital flows
Set of case studies emphasises value of macro-prudential policy in resisting credit booms across emerging and advanced economies
Swaziland central bank needs macro-prudential powers – IMF
Fund urges authorities to fast-track reform to give central bank financial stability mandate; reliance on customs union leaves economy vulnerable
BIS’s Restoy warns against ‘supervisory straitjacket’
Rules-based frameworks for banking sector intervention may “unduly constrain” regulators, the head of the Financial Stability Institute says
Bank of Spain was one of toughest pre-crisis regulators, report argues
But counter-cyclical provisions were not high enough to cope with crises, Bank of Spain says
Philadelphia Fed launches new research institute
Research body is tasked with better understanding consumer behaviour, particularly in relation to financial markets
Multiplier of spending cuts bigger than fiscal expansions, paper argues
Impact of austerity is at its peak during recessions, Richmond Federal Reserve paper finds
Fiscal stabilisation spurs growth in low fixed-asset sectors - IMF
Those with difficulty raising external funds benefit most from policy, paper argues
Portuguese bank seeks legal ruling on resolution fund payouts
BCP concerned by contingent obligations in Novo Banco sale; Portuguese government and financial sector have financed the resolution fund since its creation in 2012
St Louis Fed explains Fed’s plans to unwind balance sheet
Fed expected to stop replacing maturing securities to reduce $4.5 trillion balance sheet
New board oversight will not “lower the bar” – Fed’s Powell
The proposed new regulation will not lower the bar for boards or lighten the load of directors, says the Fed governor