Risk
Risk Management Benchmarks 2025 report – mind the techno-political gap
Responses show central banks’ shifting priorities as volatility increases
Book notes: Central bank capitalism: monetary policy in times of crisis, by Joscha Wullweber
This book asks if independent monetary policy is feasible at a time when central banks prop up the poorly regulated shadow banking sector
Central banks’ words matter for climate
Line between EMEs speaking about greening finance and AEs being wary of climate risks are blurring, argues Emanuele Campiglio
Central banks typically employ detailed business continuity plans
But institutional risk appetite is less commonly included, especially in Europe
Stress-test findings should be combined – BoE’s Benjamin
Bank’s director of financial stability strategy emphasises importance of “joining the dots”
A third of central banks lack key risk indicators
Most of those with KRIs conduct monitoring and employ feedback loops
Basel stops short on wrong-way risk
New guidelines a step in right direction, but experts warn they won’t prevent another Archegos
ECB lists climate and tech risks as supervisory priorities
SSM says strong governance and geopolitical risks will also be among key areas of focus in 2025–27
Direct system breaches are top cyber risk
Main threats vary by cyber security staffing and economic groupings
Trump 2.0 bank supervision: simpler but no soft touch?
Republican FDIC vice-chair Travis Hill wants more focus on financial risk instead of process
Over 60% of risk departments face staff and resource shortages
Teams that face hiring challenges generally have to make do with smaller risk departments
Barr’s Fed exit likely to delay, but not destroy, Basel III
Market risk, op risk and leverage ratio all in the sights of Barr’s potential successors
Accounting for banknotes
Three leading experts on central bank finances debate the appropriate treatment of currency
Cambodia allows banks to handle stablecoins and backed cryptos
Central bank sets up legal framework to regulate cryptocurrency activities
Madagascar’s governor on targeting M3 over inflation
Central Bank of Madagascar head Aivo Andrianarivelo speaks about introducing an interest rate corridor, diversifying from dollars to gold, using instant payments to bolster inclusion and drawing on IMF sustainability funding
IMF develops stress test for central bank balance sheets
Framework designed to help risk teams determine appropriate profit distributions
Repo and FX markets buck year-end crunch fears
Anticipations of changes to the Fed’s reverse repo programme contributed to easing balance sheet pressures
CNB’s Aleš Michl on tackling inflation, Friedman’s legacy and ditching DSGE
The Czech governor speaks about policy mistakes, targeting M2, diversifying into equities and gold, building new models and ending interest payments on minimum reserves
ECB raises capital requirements for eurozone banks
Geopolitics and macro-financial shocks remain top priority for next three years, annual review states
Fed stress-testing operational readiness of discount window
Experts say consultation on improved ops should be accompanied by focus on willingness to borrow
Italian lenders do not under-report default risks – central bank
Commercial lenders’ internal rating-based systems “less conservative” than central bank’s