Macro-prudential
Kuroda flags need for better network of emergency forex liquidity
Bank of Japan governor warns network of swap lines among major central banks may not be enough as systemic banks reach into a broader set of regions
Basel III has aided system stability, interbank models suggest
Model predicts future crashes will not be total wipeout
Only struggling banks cut lending to raise capital ratio – IMF paper
Study of Eastern Europe says banks' strategy matters when it comes to assessing the impact of Basel III; only banks with low profitability cut lending to meet requirements
Macro-prudential policy must move beyond core banking – BoE’s Brazier
Stressed firms may outwardly be resilient but collectively be “overwhelmed”, says BoE director, calling for collective work to understand “feedback loops”
RBA to ‘pay close attention’ to housing market in 2017 – Lowe
Rent growth remains weak but vacancy rates are not high, RBA governor says; households and banks are currently taking the right approach to the environment
UK’s PRA fines Japanese banking group for withholding information
Two arms of banking giant MUFG fall “significantly short” of regulators’ expectations, resulting in fines totalling £26.8m
Capital account management could prevent ‘commodity curse’, BIS paper shows
Authors suggest options for small open economies dealing with commodity booms; solutions could prevent reductions in welfare and support the tradable sector
Macro-prudential spillovers may grow, paper argues
Bundesbank paper uses IBRN data to analyse cross-border effects of policy
Ingves sees cross-border resolution lessons from Swedish crisis
Crisis in the early 1990s prompted Swedish authorities to take early action on cross-border resolution, the Riksbank governor says
UK financial regulators finalise plans to strengthen enforcement and transparency
PRA and FCA publish measures that will keep financial firms better informed about investigations; new framework will “command public confidence”
Basel capital floors are necessary – Riksbank’s af Jochnick
Internal models have led to doubts over true capital adequacy, Riksbank deputy says, so floors have an important role to play
Global financial safety net hits snag in regional finance
Jeromin Zettelmeyer warns moral hazard problems are now more serious with the rise of regional funds; central bank swap lines could be a partial solution
BIS authors design game of asset managers
Authors model effects of cash hoarding and investor runs, finding that “hoarding is the rule, rather than the exception”, with implications for stress testing
Italian governor calls for reform of NPL regulations
Bank of Italy paper sets out proposals for sterilising effects of NPL sales
FSB: ‘no immediate case’ for aligning rehypothecation rules
No pressing need to harmonise rules, but better monitoring of global collateral reuse will give regulators a clearer understanding, FSB says
BoE paper maps contagion via CDS market
Economists identify mechanism whereby declining creditworthiness can spill from one bank to another via credit default swaps
Non-banks may amplify risks from policy divergence, Nakaso warns
Non-banks may be less constrained than banks in supplying dollar funding, but it could dry up at the first sign of trouble; the BoJ starts stress testing foreign currency liquidity
Basel set to decide on capital relief for accounting changes
Phase-in to IFRS 9 and Cecl needed to avert "a dramatic overnight drop in regulatory capital", say auditors
FSB finalises recommended action on asset management risks
Set of recommendations tackle liquidity, leverage, op risk and securities lending; work on globally systemic designations pushed back until 2019
BIS paper flags importance of “multi-layered” bank networks
Authors go beyond aggregate exposures to reveal “multiplex” interbank networks, which could allow more tailored policymaking
Central Bank of Philippines to improve surveillance – Tetangco
Philippines has “ample” policy space to respond to risks, governor says, but monetary policy will only be enacted to prevent inflation deviation
Completing reform agenda may not be enough – Caruana
BIS chief urges continuous effort to finish reforms, but says they need to be backed by policies that raise earning and debt-repayment capacities
Colombian macro-pru measures have been effective, paper shows
Paper analyses the impact of macro-prudential measures on credit supply of banks; both reserve requirement and dynamic provisioning scheme have negative effect on credit growth
Basel III completion date pushed back
Governors and heads of supervision to delay meeting that would have given final approval to Basel III, as disagreement continues on output floors