Financial Stability
European Banking Authority unveils framework for classifying high-quality securitisations
Consultation proposes system for classifying securitisations that are ‘simple, standard and transparent’ and therefore may benefit from more lenient regulation
ECB conference tackles ‘reconciliation’ of statistics as central bank’s powers expand
Senior central bank officials from across Europe discuss the challenge of creating an integrated approach to statistics across monetary policy, financial stability and supervisory functions
Bank of Korea turns focus to stability threats after rate cut
Bank of Korea cuts rates to historic low, but shift in language indicates growing concerns over financial stability
FSB moves to tackle shadow-banking risks from SFTs
Final framework for setting haircuts on certain securities financing transactions seeks to control leverage outside the banking system and reduce procyclicality
Kuwaiti governor argues for credit ratings regulator
Mohammed Al-Hashel says rather than reducing reliance on credit ratings, he would like to see an independent institution established to ensure high-quality ratings
Eurozone shadow banks increase share of assets to 33%
Shadow-banking entities now own a third of the €57 trillion worth of assets in the eurozone financial system according to ECB report; expansion has ‘gathered pace’ since 2012
Top UK and US officials join forces to enhance resolution
Officials including Mark Carney and Janet Yellen meet in Washington to improve transatlantic cooperation in the event of a global banking collapse
PBoC and Bank of Russia establishes $24.5bn swap line
Bank of Russia says deal provides opportunity to obtain liquidity 'whenever required'; trade between the two countries has more than doubled since 2008
Carney hails ‘major achievement’ on resolution stays
Isda protocol signed by 18 major banks aims to solve cross-border legal issues, preventing a ‘cascade of termination events’ that could undermine an orderly resolution
Amro revamped in agreement struck at IMF meetings
Macroeconomic Research Office will become an international organisation when agreement is ratified, 'contributing further to regional financial stability'
Central banks respond to ECB and BoE paper on ABS
Sveriges Riksbank and Reserve Bank of Australia raise concerns over proposals in discussion paper, while Central Bank of Hungary adopts a more positive tone
IMF launches consultation with external advisors on Islamic finance
Fund working group looks to publish ‘staff discussion note’ on Islamic finance before the end of the year and organise a ‘high-level’ conference in 2015
Carney: G-20 summit will be ‘watershed’ in TBTF efforts
BoE governor looks ahead to G-20 meeting next month at IMF seminar on finance and ethics; describes Libor riggers as ‘totally detached’ from the consequences of their actions
Basel Committee toughens bank governance principles
Principles aim to instil stronger risk governance in banks, after FSB peer review identified room for improvement; focus on responsibility of boards and ‘three lines of defence’
Bank of Canada will consult public on future banknote designs
Bank of Canada launches a nationwide consultation on banknote design principles, after a report concluding that Canadians should have increased participation in the process
ECB to release assessment results on October 26
European Central Bank will publish results from asset quality review and stress tests later this month; Draghi says ‘further efforts will be needed’ from some banks
National Bank of Angola separates financial regulation from supervision
Central bank is restructuring its operating model, making a ‘clear separation between the exercise of developing standards and the role of monitoring [their] implementation’
Iceland renovates approach to financial stability
Már Guðmundsson comments on introduction of financial stability council and systemic risk committee in Central Bank of Iceland publications
BoE lifts lid on Scottish independence contingency plan
Plan warned of ‘potential instability’ from use of pound north of the border; central bank prepared emergency liquidity and clear communication strategy in run up to vote
Lars Rhode ‘firmly convinced’ by merits of banking union
The National Bank of Denmark wants to join the banking union, while the government is still assessing the consequences; Danske Bank chief economist supports wait-and-see approach
RBA’s Ellis urges policy-makers to look beyond economics
Head of financial stability says there is ‘a lot’ to learn from other research fields, even if some techniques ‘end up being dead ends for our purposes’
BIS paper tackles redistributive effects of regulation
Working paper studies how regulation tips welfare in favour of the real economy or financial sector, and suggests how regulators might deliver a Pareto improvement
Thailand’s central bank governor warns on risks of US rates normalisation
Prasarn Trairatvorakul warns that US interest rate normalisation could lead to ‘capital flow volatility’, considering it a ‘notable risk’
Portuguese governor calls for powers to act ‘just in time’
Carlos Costa argues that legislative changes are necessary to give national supervisors greater agility when it comes to intervening in failing banks