Financial Stability
Irish governor backs domestic and export banking separation
Patrick Honohan says that, by keeping the export and domestic banking sectors separate in small countries, authorities can avoid having to put a cap on the size of banks’ balance sheets
New Zealand payment systems under review
Reserve Bank of New Zealand announces review of its two large-value settlement systems; expects to sanction ‘significant upgrades’ to both within the next four years
Zambian governor says tougher capital rules will help foster financial inclusion
Michael Gondwe says recent increases in the minimum capital requirements imposed on domestic and foreign banks will make them stronger and improve the supply of credit to ‘local entrepreneurs’
Bank of England terminates mortgage support
Funding for Lending Scheme will cease subsidising mortgages in 2014; Mark Carney outlines tools the central bank could use to rein in the ‘growing momentum’ in UK housing market
Lithuania on track to join euro at second time of asking
The Bank of Lithuania has started publishing regular forecasts that keep track of the country’s progress towards meeting the convergence criteria necessary for accession to the eurozone
Deploying ‘leapfrog' tech in Africa is no easy task, finds CBP Forum
Delegates and speakers debate technology outsourcing, data, staffing, project management and international co-operation at inaugural Central Banking Technology Forum
Nigeria could ditch polymer banknotes after six-year pilot
The Central Bank of Nigeria is considering reverting back to paper banknotes after using polymer for the past six years; spokesperson says it has ‘not had a good experience’ with the plastic notes
Reserve Bank of Australia deputy governor targets productivity boost
Philip Lowe says the country will need a ‘substantial increase’ in productivity growth if it is to replicate the rapid growth in real per capita income achieved in the past two decades
Iceland governor denies 'playing politics' over plans for household debt relief
Mar Guðmundsson says government plans to reduce household debt burden will not involve 'printing money'; rejects reports that he was accused of ‘playing politics’ by prime minister
ECB prepares ground for new €10 banknote next year
New €10 note will be the second in the Europa series after the launch of the €5 note this May; Partnership Programme launched today will seek to smooth its introduction among stakeholders
Carney backs new leverage ratio powers
Bank of England announces review of its powers over bank leverage ratios; Mark Carney says that FPC control over the tool is ‘necessary to properly implement a robust capital framework’
Initial margin to significantly impact development of Asian derivatives markets: Asifma
Asifma head Austen wants exclusion of initial margin from Asian jurisdictions’ derivatives market regulation
Bundesbank’s Dombret defends Germany’s current account surplus
Andreas Dombret says the strength of German households, businesses and public sector is a stabilising factor for the eurozone as a whole; calls for acceptance of the structural differences between economies
Chan laments lessons left unlearned from financial crisis
Hong Kong Monetary Authority chief executive Norman Chan says he will continue warning against excess levels of debt, even though it is now widely seen as part of the solution to the crisis
CCPs face $161 billion liquidity shortfall to clear FX options, GFXD finds
Results of an industry study reveal the scale of the liquidity burden that would fall on CCPs clearing physically delivered FX options – but a net settlement mechanism could reduce the number by 73%
Fed’s George backs ‘diversity of views’ in supervisory process
Kansas City Fed president Esther George says it is important that the interests of all stakeholders are reflected in a country’s supervisory structure
Draghi wants European public backstop for stress tests
ECB president Mario Draghi says both national and European public funds should be in place ahead of the comprehensive assessment to ensure it is a ‘credible exercise’
Canadian paper calls for ‘simple and digestible’ communication on financial stability issues
The paper says central banks should use plain language and build a coherent narrative when communicating financial stability concerns or policies
OTC derivatives reform contains ‘real world challenges' says Fed governor
Jerome Powell says worldwide reform efforts will turn OTC derivatives market infrastructure into a ‘pillar of strength in the next crisis' if implementation challenges can be overcome
Israeli annual report for bank customers could be first step to reduce transparency 'knowledge gap'
Bank of Israel supervisor pushes for banks to provide customers with tailored yearly reports; UK consultancy says future lies in 'single online portal' for all financial products
OECD’s White says ECB supervision is back to front
William White says ECB should be managing the current crisis rather than trying to prevent the next one; warns that the global economy remains vulnerable, partly because of central bank actions
ECB gives Nouy the nod for SSM chair, but Mersch is no 'shoo-in' for deputy
ECB nominates top French regulator to head up SSM; responds to concerns that key decisions will be taken before chair is in place, but Sharon Bowles says questions remain for Draghi
Currency peg speculation can 'damage' balance sheets
Researchers find that questions over the credibility of a currency peg can have ‘damaging effects’ on bank balance sheets – consistent with monetary mismatch theory
ECB launches public consultation on mobile payments security recommendations
The governing council of the ECB asks market participants to comment on draft recommendations intended to make mobile payments more secure; interested parties have until January 31 to weigh in