Risk
Riksbank survey flags concerns on market functioning
Market participants fear effect of low interest rates and high debt could create largest impact, although they view geopolitical and emerging market issues as the most likely to be realised
Embracing digital tech could reduce systemic importance of banks – RBNZ article
Bulletin discusses risks surrounding digital disruption in the banking sector; if unregulated entities provide "significant portion" of banking services, new risks may emerge
HKMA prepares cyber security ‘fortification’
Monetary authority seeks to build a framework for assessing cyber risks as well as providing training and building infrastructure for sharing “threat intelligence”
RBI moves to curb concentrated credit risk
Central bank hopes new prudential measures will reduce banks’ “very high” exposures to large corporations and encourage firms to turn to capital markets for funding
Optimising official reserve portfolios
Bank reserve managers require a modern, flexible approach to achieving the investment trinity of safety, liquidity and return. This strategy is typified by BlackRock’s model multi-asset portfolios, which use indexes as building blocks, maintain high…
Sarb reserve management policy sheds light on tranches
South African Reserve Bank publishes investment policy governing allocation of FX and gold; splits reserves into range of tranches and sub-tranches
Basel Committee opts for local discretion on rate risk
Committee abandons attempt to create common global standard for interest rate risk, opting instead to leave discretion with banks and supervisors in final standards
World needs ‘less and better’ finance, Bundesbank board member says
Regulators must resist political pressure to water down implementation of reforms; Basel III must increase capital requirements for high-risk portfolios, Bundesbank executive board member says
Skingsley sees turning point for Riksbank policy
Immediate threat is fading, enabling the central bank to focus more on longer-term risks, deputy governor says
FRTB data standards seen as threat to emerging markets
Need for "real" prices will limit use of models, increasing capital burden
Bank of Israel establishes banking innovation division
New section of banking supervision department formed to help foster innovation but contain the accompanying risks; Dudi Bavli chosen to head division
Bank capital matters for risk-taking channel of monetary policy, Norges Bank paper finds
Less capitalised Norwegian banks are more likely to extend credit to risky firms in response to a cut in the policy rate, author finds
RBNZ’s Gordon offers advice on building a sound risk management system
Former risk head at RBNZ offers advice on what should be the focus for central banks looking to build an enterprise risk management system
Slovakian central bank boosts provisions for financial risks
National Bank of Slovakia records gross profit of €144.6 million in 2015, as both income and operating costs fall
Denmark focuses on long-dated issuance amid low rates
National Bank of Denmark’s 2016 debt issuance strategy uses long maturities to reduce interest rate risk as low rates hold down costs; return to more normal footing after last year’s suspension
RBI report lays ground for trading new derivatives
Working group proposes allowing new interest rate options in India to improve financial institutions' ability to hedge interest rate risk
Weaker shareholder liability need not mean more risk-taking, Riksbank paper finds
Study of abolition of double liability in Canada finds bank riskiness did not increase; authors suggest weaker incentives for shareholders were offset by closer scrutiny by depositors
BIS paper finds investors take simplistic approach to emerging market risks
Authors find investors seem to divide countries based not on fundamentals but on whether they are deemed an emerging market
Lane reveals string of transparency initiatives in first speech as Irish governor
Central Bank of Ireland discloses new details on salary structures as governor Lane reveals new minutes, reviews and website
Jamaican report says inflation risks balanced for 2016
Latest forecasts suggest inflation will rise to lower end of Bank of Jamaica’s target range in coming months; downside risks include reversal in food prices
Basel Committee completes trading book review
Much-anticipated redesign of market risk framework seeks to capture risks the Basel accord failed to guard against in 2008; impact study implies median 27% increase in capital charges
Initiative of the year: Reserve Bank of New Zealand
The Reserve Bank of New Zealand’s enterprise risk management system offers a best-practice example of how to build a framework from the ground up, with a small team and limited resources
Risk management services provider of the year: Wall Street Systems
A powerful real-time risk-calculation engine, consistent high-quality support and broad central-banking experience make this treasury management offering the best in class
Sovereign investor of the year: Future Fund
Australia’s sovereign wealth fund took the restrained decision not to increase its risks to chase returns in 2015. Instead it focussed on improving its operational framework