Financial Stability
RBNZ’s new governor rejects QE and capital controls
Reserve Bank of New Zealand’s Graeme Wheeler sees no need to introduce a ‘desperate’ measure such as quantitative easing in the country; rules out use of capital controls to limit kiwi dollar appreciation
Structure of banks must change as they grow, says BoE’s Haldane
The Bank of England’s Andrew Haldane discusses ways to address the ‘too-big-to-fail problem’; considers impact on banks’ economies of scale
Macedonian vice-governor assesses impact of European deleveraging
Maja Kadievska Vojnovik says Macedonia has been spared most of the direct effects from deleveraging by European banks largely due to the ‘prudent’ funding structure of local banks
FSB resolution paper due in ‘next few weeks’, says BoE’s Tucker
Lack of national legislation on resolution mechanisms has made the drafting of international standards for resolution regimes tricky. But an FSB consultative paper will be issued in the coming weeks
Customer funding gaps fall at Danish banks
Stress tests performed by the National Bank of Denmark show an increase in the capitalisation of the country’s banks; funding gaps shrink as deposits soar and lending falls
Basel Committee official rebuts criticism over regulatory complexity
Basel Committee secretary-general defends Basel III from critics who argue it is unnecessarily complicated; says additional detail needed to meet the increasing complexity of financial markets
Korea to miss OTC clearing deadline
It is ‘highly unlikely’ Korea will meet the deadline to start clearing OTC derivatives by January 1, 2013, due to legislative delays, according to market participants
Colombian paper proposes measure of systemic importance
Central Bank of Colombia study identifies important characteristics related to size, connectedness and substitutability that determine the systemic importance of financial institutions
Bank safety depends on more than high capital, says RBA’s Ellis
Reserve Bank of Australia’s Luci Ellis says higher capital levels alone do not guarantee a bank is safer than its competitors; depends on business model and risk attitudes
US reform could slash $150bn payments bill, says Fed’s Pianalto
Cleveland Fed president Sandra Pianalto explains the Fed’s vision of how the US payments system will operate in a decade; says UK offers valuable lesson on speed
Bank of Lithuania launches liquidity coverage ratio
Liquidity coverage ratio applied to credit unions in Lithuania well in advance of Basel III deadline; similar rules for banks already in place
Central bankers highlight merits of fixed exchange rate regimes
Bosnian and Barbadian governors discuss the importance of a fixed exchange rate for small and open economies
Finland's Liikanen grilled by UK law-makers on banking separation
The governor of the Bank of Finland gives evidence to UK's Parliamentary Commission on Banking Standards; faces a barrage of questions on the precise nature of separation
ECB’s Constâncio downplays impact of single supervisory mechanism
Vítor Constâncio says banking supervision will not be significantly altered when ECB starts new supervisory role; attempts to allay fears over internal conflicts and role of national supervisors
Industry unmoved by death of minor-currency Libor
The Wheatley Review calls for an end to Libor quoting in five currencies, but the number of trades affected is small, say market participants
ECB working paper examines causality in crises
A study published by the ECB investigates where causality lies between banking, debt and currency crises; also compares the duration of each
ECB paper claims credit rating agencies traded grades for custom
ECB study finds credit rating agencies provided more favourable ratings in return for continued custom; quality allegedly compromised by conflict of interest
BoE’s Haldane outlines transparent future for the central bank
Executive director for financial stability says Bank of England has undergone a transformation of communications and transparency; outlines ‘radical’ shift in central bank’s operations
EU leaders agree on new powers for ECB
European Central Bank to run single supervisory mechanism, but leaders fail to agree on when bailout funds can be directly injected into European banks
UK endorses Wheatley report to fix Libor
The UK Treasury has endorsed recommendations made by Martin Wheatley of the Financial Conduct Authority to fix Libor; will amend the UK’s Financial Services Bill
Hong Kong set to meet Basel III deadline as others struggle
Hong Kong to put final Basel capital requirements legislation in place by January 1 deadline, as most other countries struggle to hit G-20 deadline
Volcker warns of ‘permeable’ Vickers ring fence
Paul Volcker tells a UK parliamentary committee the Vickers ring fence has loopholes that will be widened over time by banks; says bad culture in trading arms ‘infected’ retail banks
Policy-makers debate how to restore trust in the financial system
Andrew Tyrie among speakers at BBA conference discussing how to develop greater trust in the financial system, ideas range from greater competition to code of conduct for bankers
Macao annual report sees ‘opportunity in crisis’
Monetary Authority of Macao annual report reveals drop in growth and climb in inflation; central bank chairman praises bank supervision developments