Financial Stability
New Basel proposals threaten bank sub debt, investors warn
Bond investors voice concerns over freedom given to national regulators to determine trigger events for conversions or haircuts
UK FSA revisits trading regulation in comprehensive review
Financial Services Authority identifies valuation, capital framework coherence and risk management as key problem areas; issues 15 recommendations to revitalise standards
Central Bank of Luxembourg: banks pass stress tests
Central Bank of Luxembourg study shows local banks’ tier one capital buffers are sufficient to weather macroeconomic shocks
BoC: contingent capital must supplement counter-cyclical capital buffers
Bank of Canada study says contingent capital more effective in providing liquidity to banks in a crisis
IMF: East African countries have divergent financial barriers
Fund study finds more advanced members of East African Community have lower financial barriers than others
Southern Sudan on the brink of collapse: deputy governor
Central Bank of Sudan deputy governor says Khartoum has starved south of foreign currency, leaving it two weeks shy of economic crisis; oil spat thought to be linked to independence referendum
Indian officials to probe De La Rue plant
Reserve Bank of India says government officials due to visit De La Rue plant; trip follows paper fault which forced De La Rue chief executive to quit
Payments providers split over Sepa end dates
Comments released by the European Commission show that European institutions and banking associations disagree over Sepa proposals to seperate end dates
Holocaust museum slams Romanian central bank over ruling on anti-Semite coin
US Holocaust Memorial Museum labels National Bank of Romania’s decision to keep anti-Semite coin in circulation “misguided”
Australia’s Battellino stresses importance of floating exchange rate
Reserve Bank of Australia deputy governor Ric Battellino says floating exchange rate regime helped dissipate external shocks to economy
Nepal to end circulation of banknotes featuring ousted king
Nepal Rastra Bank says it will phase out old notes depicting former monarch
Romania keeps coin featuring anti-Semite in circulation
Romania says it will keep a controversial coin featuring an anti-Semite despite calls for ban by Jewish community
Ireland’s Honohan defends Europe’s banks
Continent’s stress tests have lifted some of the doubt over banks’ underlying health, Central Bank of Ireland governor Patrick Honohan says
NY Fed reports dip in household debt
New York Federal Reserve says households now owe more than 6% less than in 2008
Canada throws weight behind Basel III, lauding output gains
Bank of Canada says forthcoming capital and liquidity ratios will save the country nearly C$200 billion; stresses that Canada must not rest on laurels, not having experienced banking crisis
Banks overestimate Basel III’s impact on growth: regulators
Basel body says hiking capital ratios by one percentage point will only cause 0.19% drop in potential GDP as lower rates will cushion the blow; industry bodies remain unconvinced
BoE: Agents’ summary of business conditions (June 2010)
Bank of England’s June summary of business conditions finds retailers fear government spending cuts
ECB paper: global finance has little impact on Mediterranean
Real economy, not finance, impacts Mediterranean, research published by the European Central Bank posits
Nordic and Baltic regions strike financial stability deal
Eight Nordic and Baltic countries sign Memorandum of Understanding on cross-border financial stability and crisis management
Are CoCos from cloud cuckoo-land?
The rationale for requiring banks to hold contingent capital is right. However, the mechanics of their operation and market implications may be subject to doubt, argues Charles Goodhart.
Bank's Haldane: regulators must consider changing shape and structure of finance
Executive director for financial stability at the Bank of England says regulators should reconsider the structure of financial contracts, markets, and institutions
Welcome to Twin Peaks
The decision by the British government to adopt the Twin Peaks model of financial regulation represents a significant turnaround in the Bank of England’s political fortunes, writes Michael Taylor.
Too big to fail, too big to reform
Robert Pringle and Hugh Sandeman ask is this the damning verdict of the latest batch of books on the financial crisis?