Financial Stability
Eiopa unveils 2017 stress test
UK real interest rates hit hard by Brexit aftermath, regulator says
Riksbank researchers flag benefits of major capital boost
Significant increase in the leverage ratio for Swedish banks could bring net social benefits, study finds
New Glass-Steagall would not separate banks if implemented, says Mnuchin
US treasury secretary’s stance on banking reform appears to contrast with that of president Donald Trump, who has offered seemingly contradictory statements on regulation
Former Fed vice-chair Kohn on populism, top central bankers
Donald Kohn speaks to Christopher Jeffery about his fears for the Fed amid mounting populism, why he has few policy regrets and his experiences working with some of the world’s top central bankers
Credit cycle matters for fiscal policy – BIS paper
Phase in financial cycle has “substantial” impact on public finances, authors find; commodities cycle less important but matters for some
Kashkari: Fed should not seek to deflate asset bubbles
Spotting bubbles is too difficult and the costs of failure too great, the Minneapolis Fed chief warns, although he concedes raising interest rates remains an emergency option
Malaysian central bank to name and shame non-compliant banks
Bank Negara Malaysia to publish enforcement actions next year, while introducing regulation to allow banks to share information on employees engaged in misconduct
Croatia’s Vujčić on tackling NPLs and home-host supervision
Croatian National Bank governor Boris Vujčić explains why dealing firmly with NPLs via a ‘provisioning clock’ does not choke growth while detailing the benefits of ‘home-host’ dialogues, such as the Vienna Initiative
Croatian governor: western Europe could improve NPL provisioning
Central and eastern European countries are leading the way in dealing with NPLs, says Vujčić
ECB issues guidance on leveraged transactions
Senior management must have a “comprehensive” view of all leveraged loans
Uganda will ‘claw back’ losses – Tumusiime-Mutebile
Ugandan governor remains upbeat about the country’s growth, with new figures showing recovery in both the services and industrial sectors; he urges people to ignore pessimistic media reports
IMF paper sheds light on solvency and liquidity interactions
Neglecting the “solvency-liquidity nexus” could lead to mistakes in stress-testing models, authors warn
Lithuanian central bank calls for major pension reforms
“Time to put an end” to short-term political decisions on pensions, governor says
HKMA tightens restrictions on bank loans as risks rise
The city’s de facto central bank is trying to contain credit risk among banks as their exposure to housing developers is growing
Banks mull dedicated IFRS 9 capital buffers
Volatility of loan-loss provisioning from new accounting standard demands additional own-funds protection, say banks
Digital currency could remove need for positive inflation target, economists argue
Proposed digital framework eliminates the need for “inflation buffer” and promotes transparency of the balance sheet
LTV ratio more effective than DTS in Canada – BIS paper
Paper examines the effect of recent macro-prudential policies targeting the housing market, finding households will borrow more if they can
FSB’s Mena group meets in Abu Dhabi
Turkish and Qatari governors are set to chair the regional group from June 30
Dombret defends SSM as a ‘supervisory framework’
Bundesbank board member acknowledges there are issues, including communication, with the SSM and suggests targeting language barriers to reduce “home bias”
ECB sets out standards for bank board members
New guidelines are an effort to harmonise standards across eurozone states
Let the market regulate banks – FDIC’s Hoenig
Vice-chairman offers proposal that would take an axe to risk-based capital, stress testing and parts of the Volcker rule
Protectionism is a ‘dead end’, says New York Fed president
Dudley highlights the second-round impact of protectionism, which ultimately harms higher-paying jobs; policies should foster competition and provide more assistance to workers