Financial Stability
ECB’s Bini Smaghi calls for more studies into sovereign risk
European Central Bank executive board member Lorenzo Bini Smaghi calls for more research into how markets react
IMF on why bad news increases volatility, decreases leverage
IMF research attempts to explain why bad news is often associated with higher future volatility
France’s Redouin favours central banks’ new dual role
Banque de France first deputy governor Jean-Paul Redouin says having financial stability and monetary policy under one roof will strengthen surveillance of financial sector
Dublin to split troubled lender
Anglo Irish to be split after more than a year-and-a-half of state ownership
RBI’s Thorat: formalise payments to promote inclusive growth
Reserve Bank of India deputy Usha Thorat says payments developments offer “unique opportunity”
The Italian lira: 1896-1997
Bank of Italy publishes information on pre-euro currency
International bodies fulfil G20 recommendation on information gaps
European Central Bank, Bank for International Settlements and IMF publish second part of Securities Statistics Handbook to address information gaps
EXCLUSIVE: Don’t rely on near-zero rates, says Rajan
Former IMF chief economist Raghuram Rajan warns the Federal Reserve has no quick fixes to solve United States’ economic ills but says Bernanke right man for the job
De La Rue says staff falsified banknote tests
Banknote printer says investigation into printing irregularities has revealed staff at Hampshire plant deliberately falsified paper specification tests
Israel's Fischer: economy experienced recession not depression
Bank of Israel governor Stanley Fischer says country survived the recession due to strength of economy at onset of crisis
ECB’s Bini Smaghi: contagion must be contained through rules-based approach
European Central Bank member Lorenzo Bini Smaghi says countries should stop paying lip service and instead adopt a rules-based approach to stopping contagion
Banks upped exposure to troubled eurozone states in first quarter: BIS
Bank for International Settlements says first quarter figures show exposure to Portugal, Greece and Spain grew, in spite of default worries
Afghanistan’s Fitrat says Kabul Bank no longer in danger: reports
Bank of Afghanistan governor Abdul Qadeer Fitrat claims beleaguered Kabul Bank is out of danger, despite continued run on bank, reports say
ECB documents success of eurozone retail payment systems
European Central Bank releases comprehensive overview of the payments systems, including underlying concepts and the role of the central bank; book notes success of Step1 commercial payment system
Bank of Israel: FX intervention forced shekel depreciation
Bank of Israel study says ad hoc purchases successfully depreciated the value of the shekel against the US dollar
ECB’s González-Páramo highlights flaws in collateral framework
European Central Bank executive board member José Manuel González-Páramo acknowledges risks in central bank’s willingness to accept broad range of collateral
Settlement system gets go-ahead from RBNZ
Reserve Bank of New Zealand and Securities Commission give “statutory backing” country’s third settlement system; system a joint venture between central bank and stock exchange operator
Trichet to be first head of European Systemic Risk Board
European Central Bank president Jean-Claude Trichet will chair continent’s new systemic risk board until the end of his term; proposal reflects compromise between parliament and national governments
Islamic banks affected differently by crunch: IMF
IMF research finds Islamic banks outperformed conventional rivals in 2008, but trend was reversed following year
Fuld and Fed’s Baxter at odds over Lehman failure
Ex-Lehman Brothers’ chief Dick Fuld blames Federal Reserve for failure of investment bank; New York Fed general counsel Thomas Baxter says central bank could not have provided liquidity lifeline
Bernanke: Fed won’t rule out leaning against wind
Regulation should be “first line of defence” against bubbles, but FOMC is monitoring financial imbalances
Indonesia moots new rule to boost bank lending
Bank Indonesia to propose range of loan-to-deposit ratios to encourage lending; banks prefer to park deposits in money market due to perceived default risk
BoJ: Financial Markets Report
Stock market volatility, declining yields on government debt and money-market operations covered in review
Moral hazard not contained prior to crisis: Norges Bank paper
Norges Bank paper co-authored by Bank for International Settlements' Claudio Borio points to lessons from the Nordic experience