Financial Stability
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
BoE’s Tucker says FCA may have to intervene to correct accounting failures
Paul Tucker says difference in market and banks’ asset valuations may require intervention by the Financial Conduct Authority; praises bail-ins as method of imposing discipline
BoE behind UK move to cut bank capital requirements
Bank of England’s interim Financial Policy Committee ordered a temporary easing of Pillar II bank capital buffers for British banks last month
UK’s Wheatley outlines steps toward new regulator
Chief executive-designate of the UK’s new Financial Conduct Authority outlines regulatory vision; new body to be created in 2013 as one half of ‘twin peaks’ approach
Canada’s Carney wants an end to ‘global angst’
Bank of Canada governor Mark Carney says quick and bold action needed to end uncertainty restraining economic growth
Robert Pringle’s Viewpoint: Fixing banks and regulation
Central bank balance sheets are ballooning due to the failure of banking systems and new rules are unlikely to address the issue. Only a full legal separation of banking activities will do.
Shirakawa proposes tackling financial stability as a ‘public good problem’
Bank of Japan governor, Masaaki Shirakawa, says an optimal solution to create the conditions needed for financial stability could be achieved by reviewing the challenge as a ‘public good problem’
Bernanke plays down emerging market impact of QE
Fed chairman says negative impact of quantitative easing on emerging markets is offset by a stronger US economy. But countries such as Brazil have had to take action to protect their currencies
CFTC’s clearing timeline prompts backloading 'meltdown'
A re-reading of the CFTC's phase-in rules for central clearing is prompting alarm among buy- and sell-side firms