Risk
Ingves laments complexity in Basel trading book
Basel Committee chair says he would have preferred a simpler approach to market risk; work on other risks will tend towards greater simplicity, and will likely include external credit ratings
SNB’s Zurbrügg says negative rates painful but necessary
Vice-chair concerned by financial stability impact of negative interest rates, but says they make sense from a monetary policy perspective; talks with industry have been ‘very heated’
Lagarde calls for ‘policy upgrade’ across the globe
Managing director of the IMF tells advanced economies to ‘fully incorporate’ spillovers in decision-making, and eurozone to tackle problem with non-performing loans
Basel Committee considers limiting bank modelling choices
Study of internal models of counterparty credit risk finds ‘considerable’ variation between banks, raising the possibility of the Basel Committee takings steps to increase consistency
Cyber attacks could represent systemic threat, warns Ireland’s Roux
A string of cyber attacks on financial institutions could start a ‘domino effect’ that triggers a financial crisis, so firms need to improve their defences, deputy governor says
Belgian paper explores link between monetary policy and risk-taking
Model suggests central banks should stabilise the path of the real interest rate more when there is a ‘risk-taking channel’ of monetary policy, to help reduce ‘welfare detrimental fluctuations’
Market liquidity drained by regulations, says DBS chief
Volcker, Basel III and Dodd-Frank have combined to drain liquidity, CEO says – particularly in times of market stress
EBA raises ‘significant concerns’ over bonus culture at European banks
Bonuses at many banks found to have little correlation with performance in last bonus round before cap; one banker paid over €18 million and largest bonus proportionally was 25 times base salary
BoJ deputy urges thorough analysis of risk weight revisions
Hiroshi Nakaso calls for a cost-benefit analysis of proposed revisions to ‘standardised approach for credit risk’ that some market participants fear could restrict financing for development
Banks attack proposed risk weights for specialised loans in Europe
EU lenders say both of the EBA’s suggested methods for risk-weighting real estate and other specialised loans would distort regulatory capital
CoCo bonds decrease banks’ appetite for risk, paper argues
Convertible bonds decrease banks’ incentives to take risks in highly-leveraged states, a DNB working paper argues
BoE’s Gracie describes unique dangers of cyber attack
Unprepared firms could find themselves up against attacks by fraudsters or unscrupulous states, and the damage could be difficult to detect
Setting risk appetite key foundation for risk culture, speakers at OpRisk Asia say
Efforts to change risk culture should focus on a few 'risk champions' in each department, the OpRisk Asia conference in Singapore hears today
EBA reports shine light on variation in risk weights
Two studies aim to track down some of the reasons that risk-weighted assets appear to vary across banks with similar risk profiles, offering suggestions for supervisory action
IMF paper: commodity prices are largely demand-driven
Working paper explores systemic risk, aggregate demand and commodity prices, finding the latter to be largely demand-driven, a conclusion they extend to non-core inflation
Colombian paper paints nuanced picture of bank risk and efficiency link
Researchers find some efficiency gains from better capitalisation, but results differ depending on whether a bank is large or small, domestic or foreign
Capital volatility fears spur talk of wider G-Sii charges
Concerns about yo-yoing capital are behind proposals to extend the higher loss absorbency requirement beyond non-traditional business
Banks are de-risking due to lack of regulatory direction
Banks are struggling to balance growing compliance costs with the need for a risk-based approach to individual client accounts. Regulatory guidance isn’t helping, a London conference hears
Basel considers U-turn on fourth trading book QIS
Industry lobbying prompts regulator to revive plans for a further impact study
Banks find huge capital jump in study of new standardised approach to market risk
Impact study shows five-times increase under revised standardised approach to market risk
Riksbank risk survey flags concern over easing impact
Respondents warn of a slight deterioration in the outlook for financial stability after launch of further monetary easing, including higher levels of risk and lower liquidity
Regulators to put CCP risks under microscope
CPMI-Iosco stress-testing quiz will be precursor for broader review of risk management practices
Sarb expands risk management framework
The risk management framework of the South African Reserve Bank now includes policy risks and will soon include financial stability policy, reveals deputy governor
BoE challenged US Treasury on G-Sii status of Berkshire Hathaway
UK regulator asked for clarity on Berkshire's place in provisional list of systemically important firms