Financial Stability
Some analysts see stress tests losing effectiveness – Stournaras
Greek central bank governor raises questions over perception of stress tests; regulators’ models need to take more account of national differences, he argues
Basel Committee restricts bank options for internal modelling
Banks will no longer be able to use the internal ratings-based approach for certain portfolios, and will face restrictions in other areas, under proposed rules
RBNZ proposes new powers over FMIs in times of crisis
Final crisis management plan proposal details two-tiered framework for FMIs; RBNZ and FMA would act if contingency plans not up to scratch
European Central Bank outlines three models underpinning macro-prudential analysis
First biannual macro-prudential bulletin lays out details of three key models, dealing with capital requirements, household finances and bank vulnerabilities
AFI’s Hannig sees central banks bolstering resources to drive inclusion
Alfred Hannig expects central banks gradually to increase resources devoted to inclusion as they take more responsibility for the area; Alliance for Financial Inclusion announces independence
Governor sees Chile progressing with macro-prudential framework
Working paper outlines importance of macro-prudential policy in maintaining financial stability; Vergara and Raddatz identify counter-cyclical capital buffer as a possible tool for the future
BoE’s Breeden plots route to ‘third phase’ of global banking regulation
Regulators have moved from fragmentation to “balkanisation”, and now must work to establish full co-operation, executive director says
IMF urges Mauritius to form macro-prudential authority
Central bank would have “prominent” role in new authority; as a first step, IMF staff recommend establishing a technical group featuring representatives from multiple stakeholders
Negative rates one of many pressures on bank business models, Lautenschläger says
ECB supervisory board vice-chair says business models must cope with a range of challenges, of which low rates are just one; Nouy and Lautenschläger field questions following annual report
ECB’s Mersch provides update on infrastructure work
Yves Mersch says business requirements being gathered from market participants ahead of instant payments; highlights plans for review of harmonisation of collateralisation procedures
Nakaso considers how policy-makers could respond to low bank profitability
Bank of Japan deputy notes financial stability risks from monetary easing are low at present; considers how to respond to overheating or low profitability if necessary
Low profitability and NPLs remain top of the eurozone supervisory agenda
European Central Bank presents annual report for supervision, with major concerns including profitability and non-performing loans; supervisors are working closely with the single resolution board
Government approves final stage of Thai development plan
Bank of Thailand will promote electronic payments in latest phase of financial sector master plan; all phases to be completed by 2020
Global financial safety net relies on maintaining IMF resources – paper
Regional funding arrangements and credit swap lines have grown in importance in providing support in times of stress, but maintaining IMF funding remains key, paper says
BoE’s Forbes outlines new thinking on current account imbalances
Breaking current account into trade and financial components allows more detailed analysis of when a large imbalance is dangerous and what shocks could cause trouble
Vítor Constâncio calls for macro-prudential tools to reach beyond banks
Authorities should be granted wider powers over alternative investment funds and shadow banking sector, including margins and haircuts on derivatives and securities financing, Constâncio says
Fed QE drives portfolio rebalancing towards foreign assets, Brazil paper finds
Research analyses ‘comprehensive’ dataset for Brazilian capital flows and a smaller one for other EM economies