Risk
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
Colombian paper finds ‘negligible’ contagion effects
Contagion in the interbank market poses no real threat to the Colombian financial system, working paper notes; examines link between bank failure and liquidity
Paper studies central bank risk and return over 175 years
Research uses the National Bank of Denmark as a case study, exploring how its balance sheet and profit from financial items evolved between 1839 and 2014
BoE’s FPC in line for powers over buy-to-let market
Government proposes handing central bank powers of direction over LTV and ICR limits for buy-to-let mortgages, over a year after the BoE first requested them
Bonus cap may impact other pay regulation, research from Bank of England warns
Researchers see potential for bonus caps to clash with other remuneration regulation; level of pay ‘at risk’ declines
Bank of Canada identifies ‘prolonged weakness’ in commodity prices as a key risk
Latest financial system review suggests the resulting stress would be ‘manageable’, although an additional ‘large and broad-based drop’ would pose a bigger problem
EU survey calls for more cohesion on cloud computing
There appears to be a lack of clear and formal guidance from financial supervisors on banks’ use of cloud-based IT services, while their use is underestimated, an EU agency says
Banks may need major overhaul to handle new disclosures, FSB task force says
Many banks will need to make ‘substantial changes’ to systems and processes to cope with new and more complex standards on accounting for expected credit losses, report finds
Banking union prompts ‘strategic refocusing’ at EBA
Andrea Enria sees banking union as ‘game changer’ for EBA; sets out three ‘lines of action’ to approach new landscape
ECB flags threat of ‘abrupt reversal’ in risk premia
Latest review identifies two ‘medium-level systemic risks’ to the eurozone's financial stability, weak profitability prospects for banks and a potential ‘sharp adjustment’ in risk premia
Eurozone banks face 'in-depth' scrutiny of risk handling, Nouy says
Banks’ handling of risk is being subjected to in-depth analysis by the ECB’s single supervisory mechanism, Danièle Nouy says
Banks face higher capital requirement under Basel trading book review
Basel Committee impact study on the fundamental review of the trading book implies minimum capital allocated to market risk will rise substantially for some banks
Statistical spin may decide severity of trading book rules
Capital increase levied by Basel Committee on Banking Supervision could depend on use of mean versus median figures
EBA launches consultation on credit value adjustment risk
The European Banking Authority launched a public consultation on regulating credit value adjustment risk; aims to create a ‘common European approach’
FSB refines shadow banking definition with new ‘activity-based’ measure
Attempt at greater precision estimates shadow banking sector represents around 30% of non-banks; final framework for securities financing transactions published