Financial Stability
UK firms must prepare for Brexit risks – FCA
EU and UK have yet to agree on equivalence, senior official warns
US living wills must include ‘lessons learned’ from Covid-19
Large banks must outline how crisis is impacting resolution planning capabilities, Fed and FDIC say
ECB stresses capital requirements won’t hamper bank mergers
Central bank launches consultation on new guidelines on banking sector consolidation
Fed’s safety nets are ‘fundamentally unsustainable’
The Fed’s new safety nets will allow “zombie companies” to thrive and drag down productivity; ever-increasing levels of interventions are “fundamentally unsustainable, intertemporally”, says William White
Dividends should be subject to macro-pru limits – ECB paper
Measure would reduce volatility in loan supply and equity levels, economist argues
Non-banks exposed to riskiest CLO tranches – Fed research
Risky holdings appear to be larger than market participants believe, economists say
Mobile payments banned in Zimbabwe
Central bank suspends mobile payment platforms following government circular
BIS warns of further shockwaves in ‘generation-defining’ crisis
Solvency crisis is looming on the horizon and health crisis is far from over, BIS officials say, as they present the 2020 annual report
Funds warm to Esma liquidity rules after Covid crisis
Funds are embracing stress-testing, and swing pricing, after “a real liquidity crisis” in March
IMF warns unprecedented central bank support may fuel instability
Investors may be too optimistic about recovery, IMF report says
Lebanon’s powerful central bank chief and its slide into crisis
Governor Salameh created unsustainable banking sector, former minister alleges in an interview
Fed finalises Volcker rule reform
Amendments permit banks to return to risky activity seen in 2008 financial crisis, Lael Brainard warns
FSB flags ‘gaps’ in too-big-to-fail reforms
Report highlights evidence reforms are working, but resolution remains imperfect and data limited
Fed caps dividends after stress tests show big potential losses
Brainard says decision not enough as tests show loan losses could exceed those during financial crisis
Book notes: Stable banks in challenging times, by Andreas Dombret
Dombret’s stability and rule-based compass should be that for every aspiring central banker, worldwide
Podcast: Boston Fed backs community action on Covid-19 and racial inequality
Working Cities Challenge is not only helping economic resurgence in struggling cities, but also fostering better responses to Covid-19 and racial inequality, official explains
NGFS unveils climate stress-test scenarios
Group releases guidance document and data to help central banks tailor climate stress scenarios
New European payment effort delayed due to Covid
Consolidation of Target2 and T2S platforms hindered by pandemic
Fed to assess banks’ management during Covid-19
Supervisors evaluating business and operational strategies, cyber security and market risk assessments
ECB warns Slovenia over new loan law
Yves Mersch says ECB should have been consulted over law and warns of financial stability effects
NGFS offers concrete next steps to assess climate vulnerabilities
New climate risk scenarios will be incorporated into Bank of England stress tests and Bundesbank economic modelling, write Sarah Breeden and Sabine Mauderer
CGFS report offers policy advice for coping with dollar funding strains
BIS committee gives advice amid “major changes” in the structure of global dollar funding markets
FCA to gain new powers to tackle ‘tough legacy’ issues in Libor transition
Untangling complex legacy issues is looking increasingly difficult as delays mount due to Covid-19