Financial Stability
DNB sizes up pension fund recovery plans
DNB assessment of recovery plans highlights funds do not intend to cut pensions in order to achieve new regulatory requirements
MAS takes step to facilitate capital sourcing across Asean jurisdictions
Singapore central bank issues implementation handbook with Thai and Malaysian regulators for firms looking to raise capital in other Asean countries
Safe as houses: designing a more stable mortgage
A conference at the New York Fed earlier this year looked at some innovative mortgage designs that could boost financial stability. Central Banking approached some of the speakers to learn more
BIS paper studies impact of Swiss CCB on quality of credit
Working paper finds activation of countercyclical capital buffer affected the composition of mortgage lenders in two key ways
Israel’s bank supervisor looks to split credit card companies from banks
Hedva Ber has revealed plans to boost competition in financial sector, including forcing two of the largest Israeli banks to sell their credit card companies and creating a credit database
BoJ deputy urges thorough analysis of risk weight revisions
Hiroshi Nakaso calls for a cost-benefit analysis of proposed revisions to ‘standardised approach for credit risk’ that some market participants fear could restrict financing for development
UK payments regulator approves of code of conduct
Big UK banks have published a voluntary code of conduct for those providing indirect access to payment systems, in a bid to improve standards
UK payments have room for improvement, report finds
Report identifies priorities for better payments among consumers, businesses and government, finding desire for faster, more flexible payments with less room for error
RBI designates two banks ‘systemically important’
Reserve Bank of India lists State Bank of India and ICICI Bank as ‘domestic systemically important banks’ and details additional capital requirements
Ukraine central bank awaits wider regulatory powers
Ukraine’s central bank has achieved significant reforms of the banking sector, but needs a draft law to pass to gain the power necessary to regulate the non-bank sector, World Bank analyst says
Finnish deputy: international competition will change mortgage lending
Bank of Finland deputy argues conditions for international competition in mortgage lending are ‘improving’ and there is the potential for a ‘substantial impact’ in the eurozone
Household debt had modest impact on US consumption, research finds
Household debt in the US accounted only slightly for the decline in household consumption nationally in the 2000s, research published by ECB finds
BIS paper finds emerging market corporations exploiting carry trade
Study of emerging market foreign currency-denominated bond issuance by Bruno and Shin finds corporations appear to be issuing bonds as part of a carry trade, rather than financing investment
IMF paper explores capital inflows and credit growth
Working paper finds an increase in capital inflows can fuel credit growth, but it depends on their composition; no ‘significant’ connection with foreign direct investment
Ukraine strikes debt restructuring deal with main creditors
Agreement would see creditors accept 20% nominal haircut on $18bn worth of debt; finance minister and IMF head hail agreement and stress need for support among bondholders
Eurozone QE has ‘significantly increased inequality’, Bundesbank paper argues
Asset price changes following the introduction of eurozone quantitative easing have largely benefited the wealthiest households, a Bundesbank working paper says
Hungary aims to implement LCR ahead of schedule
Announced timetable is quicker than the minimum outlined in Basel III and the accelerated timetable agreed under the capital requirements directive
China's premier says renminbi at ‘equilibrium’
Li Keqiang plays down the risk of further renminbi depreciation, suggesting it will be ‘kept basically stable' at the prevailing rate in a move that may offer relief to hard-hit emerging market currencies
RBI looks to ‘disruptive innovation’ to boost inclusion
Granting licences to 11 payment banks is the next step in a ‘payments revolution’ in India that should increase financial inclusion, deputy governor says, although not all technologies are benign
Canadian deputy says LTV and DTI limits ‘most effective’ macro-pru tools
Lawrence Schembri examines demand and supply factors underpinning rise in house prices; evaluates macro-prudential tools used in Canada and elsewhere
Equity price growth rate ‘leading indicator’ of bank loans, French paper argues
Comparing two models of domestic credit dynamics to recent French data shows the importance of equity price growth rates, according to a Banque de France working paper
South African central bank open to currency intervention
Chinese devaluation stokes fears of further currency falls in economy vulnerable to exchange rate shifts
East African governors say structural measures needed to stabilise currencies
Senior central bank officials from Burundi, Kenya, Rwanda, Tanzania and Uganda identify measures necessary to ensure long-term stability of their currencies
Kazakh central bank moves to stabilise banking sector
Central bank launches plan to compensate depositors hit by collapse in value of tenge, as banks reliant on external funding run into problems