Risk
European authorities warn of dangers in cryptocurrency markets
Spanish and Dutch central banks warn of “misleading” data and unregulated markets
UK regulators unveil rules for algo trading
PRA and FCA outline their approaches to supervising the ultra-fast trading methods
China’s shadow banking market dominated by banks
BIS researchers map the Chinese shadow banking system and its evolution over time, finding it contrasts with the market-based shadow banking of the US
EBA issues updated list of risk indicators
European Banking Authority sets out latest indicators and “detailed risk analysis tools”
Chicago Fed’s Evans calls for caution in raising rates
Charles Evans makes the case for delaying rate rises, fearing inflation expectations may have drifted downwards
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
Banks running out of time to make post-Brexit eurozone applications
Banks looking to relocate should apply “by the end of the second quarter” – ECB supervisor Lautenschläger
Fed imposes growth cap after ‘consumer abuses’ at Wells Fargo
Troubled lender is not allowed to expand its assets further until it improves governance and controls
CCP stress tests have found capital shortfalls – Esma
Small increases to stress-test scenarios would have left ICE Clear Europe “in material breach”
BoE’s Brazier flags concerns about ‘stretched’ credit markets
BoE is simulating ‘liquidity mismatch’ in bond markets to ensure financial stability, says executive director; central bank has a ‘duty’ to adapt regulation
Carney rejects accusations of ‘cognitive bias’ at BoE
Parliamentary committee members say BoE relied on inaccurate forecasts before Brexit, affecting policy decisions
Securities lending services provider of the year: Northern Trust
Official institutions praise the Chicago-based firm’s excellent coverage, operational smoothness and good returns
HKMA exchange fund clocks 10-year high returns
Returns driven by strong global economy and financial markets; 7.1% figure highest since 2007
Asset manager of the year: BlackRock
BlackRock delivered some innovative new products and a highly regarded training scheme to build on its already strong foundation in reserve management services
Central bankers assess markets’ reactions to policy changes
Benoît Cœuré warns of complacency among investors as central banks move to normalise
Fed paper models risk-taking channel of monetary policy
Model in which monetary expansion increases risk-taking appears to fit with the data
Central Banking Awards: BoE a leader in fintech
Awards go to the Bank of England, Vizor, Lanqart and Openlink for their innovative work
Technology consultant of the year: Vizor Software
The Dublin-based company continued to grow its client base in 2017, proving its mettle in emerging markets, with the addition of Brunei’s central bank and the Zambian pensions and insurance regulator
Risk management services provider of the year: Openlink
Openlink’s central bank and state agency client base continues to grow, with the addition of a number of new clients, including Queensland Treasury Corporation
Short-selling bans increased instability – ESRB paper
Banks’ volatility, leverage and default probability increased by bans on short-selling – researchers
Core-periphery model of bank networks called into question
Researchers find multiple cores in the interbank market, posing different systemic risks
Low rates push investors to seek risk abroad – BIS paper
Authors find that low rates at home drive risk-taking overseas and the effect accelerates as rates approach zero
Fed could use rates to counter instability – Mester
2015 exercise showed major problems in use of macro-prudential tools, says Cleveland Fed chief
BIS paper asks what makes emerging market banks profitable
Both bank-specific and economy-wide factors affect banks’ profitability, authors find