Financial Stability
Colombian paper finds wholesale funding can increase financial sector fragility
Monitoring credit funding sources could provide an additional tool to warn against banking disruptions, paper shows
German court rejects challenge to ESM legality
Constitutional court backs Germany’s participation in European Stability Mechanism; Basel Committee rules that banks do not have to hold capital against ESM bonds
Central banks have ‘irreducible’ role in financial stability
Reserve Bank of Australia assistant governor Malcolm Edey says central banks are entwined with financial stability whether or not they have formal prudential powers
ECB reveals plans for supervisory board minutes
Danièle Nouy says the supervisory board will submit a record of proceedings to the European Parliament on a quarterly basis
BoE praises implementation of new loss-allocation rules for clearing members
Bank's first annual report on supervision of financial market infrastructure since assuming oversight responsibilities for central counterparties last April
PBoC doubles reminbi trading band
The People's Bank of China announced this weekend it will double the renminbi's trading band to let it fluctuate 2% either side of the bank's daily reference rate
More bank capital means banks lend more, paper finds
More capital means more credit - but greater supervisory capital constraints mean bank credit grows more slowly than when banks are less constrained
World should brace for impact of rising Chinese exports, report warns
Array of ‘major problems’ afflicting the Chinese economy is likely to require renminbi devaluation, with knock-on effects for the rest of the world, research warns
Bail-in rules the 'bedrock' of European banking union, says BoE's Cunliffe
Head of the UK's Prudential Regulation Authority also cautions that despite far-reaching reform efforts, regulators would struggle to resolve 'a failing global giant'
BoE’s Haldane underscores need for ‘ambidextrous’ policy
Executive director says it is too much to expect ‘one-handed’ policy to keep control of the economy, instead recommending monetary and macro-prudential policy work in tandem
HKMA rebukes UBS over attempts to rig Hibor
Hong Kong central bank finds six traders at UBS tried to influence the bank’s Hibor submissions between 2006 and 2009; demands remedial action
Fed nominee Fischer grilled on Citi ties
Former Bank of Israel governor faces tough questions on ‘revolving door’ between Citigroup and top US government roles; fellow candidates Lael Brainard and Jerome Powell also testify
MAS spearheads Bitcoin exchange regulation
Central bank is one of the first to act on regulating virtual currency exchanges, although controls are limited to money laundering and terrorist financing
Sovereign credit ratings have asymmetric impact, ECB paper finds
Working paper finds market volatility depends on whether the rating was an upgrade or a downgrade; identifies channels of contagion between countries
Nigerian deputy governor moots tax on FDI dividends and capital transfers
Kingsley Moghalu laments emerging markets' ‘Faustian bargain' with short-term portfolio investors; moots explicit measures to stem capital outflows in wake of Fed taper
Riksbank paper examines dynamics of foreign funding by Swedish banks
Study finds currency hedging needs of institutions and companies incentivise Swedish banks to issue securities in foreign currency
Carney pledges to push BoE FX investigations 'all the way'
Bank of England governor Mark Carney pledges to get to the bottom of allegations that UK central bank condoned market manipulation in FX markets
Target2 'filled in' balance of payments gaps during euro crisis, NY Fed paper finds
Federal Reserve Bank of New York study finds adjustment to the pullback of private capital during the euro crisis made less harsh by Target2
Dombret calls for cap on bank loans to sovereigns
Deutsche Bundesbank board member advocates a cap on the amount banks can lend to an individual sovereign, as they should never ‘put all their eggs in one basket’
ECB sets out second phase of asset quality review
The European Central Bank reveals the methodology of its asset quality review and provides guidance for national authorities tasked with executing the inspection
RBA takes next step in opening up payments market
Shake-up of access regimes aims to give more room for competition in the Australian payments market; proposed changes still need amendments to legislation to go ahead
Banks switch strategies way ahead of new regulation, paper finds
ECB working paper studying a set of Finnish banks finds they anticipated Basel II by up to seven years, shifting their credit portfolios in preparation for the new regulatory environment
Nature of shock explains linkages between monetary and macro-pru policies
Riksbank article studies linkages in a dynamic general equilibrium model, where macro-prudential policy is exemplified by a countercyclical capital buffer
BoE launches banknote security app
Bank of England launches an interactive application for use on mobile devices that helps the public identify security features on its banknotes