Financial Stability
Fed’s Stein highlights transatlantic risks
Jeremy Stein discusses situations that may lead to a spike in dollar funding costs for European banks operating in the US; says renewed swap lines and new regulation will help
BBA delays phase-out of some Libor rates after complaints
Less-used rates will be produced until May 2013
BoE to get new FMI supervision department
Bank of England will gain new powers of oversight over financial market infrastructures after transition from Financial Services Authority in April next year
RBI’s Padmanabhan on technology in the financial sector
Reserve Bank of India executive director sets out where technological change has improved financial services and where it still can
Target2’s missing settlement mechanism creates systemic risk
In the latest edition of the Central Banking Journal, Hans-Werner Sinn argues the lack of yearly ‘settling up’ in the European Target2 payments system is fuelling major imbalances within Europe
Draghi says resolution framework is priority for 2013
ECB chief tells European Parliament single resolution mechanism and reforms to restore competitiveness are ‘key priorities’ for 2013; gives assurances monetary policy will not be impaired
Asic to consult on trade repositories in first quarter 2013
The Australian securities regulator is looking to consult on its trade repository plans at the end of the first quarter, with an eye to implementing the regime later in the year
Committee admits 40% of countries will miss Basel III deadline
Eight out of 19 jurisdictions will miss January 1 deadline for Basel III capital requirements; Stefan Ingves concedes some jurisdictions may still be behind at end of 2013
Banque de France paper tests policy interactions
Researchers examine optimal configurations of monetary and macro-prudential policy under different conditions; find monetary policy cannot affect financial stability in some cases
Ghana annual report details payments upgrades
Bank of Ghana notes projects implemented in 2011 to improve financial market infrastructure
Riksbank study tackles capital buffer challenges
Research by members of the Sveriges Riksbank’s financial department analyses the problems posed by Basel III’s counter-cyclical capital buffer
Central banks extend swap arrangements
Bank of Canada, Bank of England, European Central Bank, Swiss National Bank and US Federal Reserve extend temporary US dollar and bilateral swap agreements
French research says monetary policy can offset herding
Banque de France working paper says interest rate hikes can be used to eliminate asset price bubbles caused by investor herding behaviour
The ghost at the IMF’s Tokyo feast
Robert Pringle looks back at the main themes of the IMF’s annual meeting, which was held in October in Tokyo, and forward to prospects for 2013
Book notes: The Great Recession: Market Failure or Policy Failure?
This is a hugely important book that should be read by all central bankers, bank supervisors, politicians and newspaper editors
Book notes: Guardians of Finance
This is a book offering a useful contribution to the debate over the future of regulation. By James R Barth, Gerard Caprio Jr and Ross Levine
Book notes: First Principles: Five Keys to Restoring America's Prosperity
The author's premise is that the best way to understand the problems confronting the American economy is to go back to the first principles of economic freedom upon which the country was founded
Fiji governor unveils first polymer banknote
New five Fijian dollar note to incorporate polymer substrate for the first time; $2 note replaced with coin
Experts advocate replacing OMTs with gold-backed bonds
Using gold as collateral for sovereign debt could circumvent concerns about fiscal transfers associated with ECB’s OMT programme, panellists say at World Gold Council briefing
EU leaders thrash out ECB bank supervision deal
European finance ministers reach agreement that gives the ECB supervisory powers over the largest banks; EBA rules adjusted to balance voting powers of states outside supervisory mechanism
Paper finds flimsy productivity base for banks in Spain
A Bank of Spain working paper says two-thirds of pre-crisis banking productivity growth was attributable to the expansion of mortgage lending, a reliance on short-term finance and leverage
ECB in danger of being forged from fiscal fragility
Mario Draghi has made his mark at the helm of the European Central Bank. But Europe also needs a core set of values that must not be violated
Cyprus may create ‘bad bank’ as part of reforms
Panicos Demetriades outlines plans to monitor undercapitalised banks and possibly create a ‘bad bank’; Irish chief economist says the burden of austerity measures must be shared
Dealers seek second business conduct reprieve from CFTC
Less than 1% of OTC derivatives counterparties are ready to trade under new business conduct regime. Non-compliant firms may be frozen out of the market, banks warn