Financial Stability
Canadian deputy champions FSB
FSB may be small but is capable of ‘nimbly’ co-ordinating global reforms efforts in a way that other international organisations are not, says Lawrence Schembri
Crisis prompted both ‘re-discovery' and overhaul of CBs' emergency liquidity
Walter Bagehot's dictum to lend freely at high interest rates and against good collateral during a financial panic was revived, then altered during the crisis, according to Thomas Baxter of the NY Fed
Hong Kong and Australia see risks in low interest rates and Chinese NPLs
Impact of any shift in the yield curve on banks' balance sheets ‘may not be small', according to HKMA; RBA urges lenders to maintain prudent risk appetite as rates remain low
Pianalto confident in case for faster retail payments
Cleveland Fed president Sandra Pianalto says the lack of 'concrete' evidence in favour of a near-real-time payment system should not stand in the way of its creation
ECB appoints Oliver Wyman to conduct ‘comprehensive' eurozone bank review
European Central Bank appoints the same consultancy firm as conducted Spain's banking stress tests and is doing the same for Slovenia; more details of the comprehensive review to follow soon
FDIC chair discusses US effort to balance capital and leverage requirements
Martin Gruenberg says Basel III relies too heavily on capital ratios, potentially incentivising big banks to employ ‘imprudent' leverage strategies; discusses regulatory remedies
ECB paper develops macro-pru tool probing impact of sudden capital outflows
Results show limited impact of a liquidity shock on banks' solvency ratios in the short term, but ‘moderate to high' effect on the supply of credit to the broader economy
NY Fed trials new reverse repo facility
Federal Reserve Bank of New York tests new overnight reverse repo facility; William Dudley believes it will bolster the Fed’s control over short-term money market rates
ECB paper says regional macro-prudential tools would mitigate eurozone imbalances
Macro-prudential tools such as loan-to-value limits could help prevent imbalances between the eurozone core and periphery if applied on a regional basis, according to ECB research
Emerging market volatility not a sign of crisis, says Malaysian supervisor
Emerging markets are much better prepared to deal with foreign investment outflows than in the past, says Securities Commission Malaysia chairman
US fiscal stance is creating inflation, says Riksbank paper
Researchers show the existing unsustainable levels of US federal debt are generating inflationary pressures, but these are difficult to spot as they are being dwarfed by Fed policy and economic slack
Bank of Finland deputy urges banks to meet mobile and internet payments demand
Pentti Hakkarainen says banking sector has not met Finnish population’s demand for mobile, internet or real-time payments; says banks risks losing their data advantage over other institutions
Euro crisis will leave Greece stronger, says Herbert Grubel
Membership of a currency union initially failed to force Greece to reform its economy but the country is now set to emerge from the crisis unshackled from former vested interests; the case of Greece may offer lessons for other democracies
RBNZ closing loan valuation loopholes
Reserve Bank of New Zealand proposes stricter rules on how banks value housing loans and residential properties to prevent them undermining new macro-prudential policy
Scandinavians open macro-pru toolbox to cool overheated housing markets
Rising property prices, increasing household debt and towering banking sectors are pushing Norway, Sweden, and Denmark to consider unconventional measures to pre-empt a crash
Carney new vice-chair of ESRB as King joins Fischer at CFR
Mark Carney takes over from Mervyn King as deputy to European Systemic Risk Board chairman Mario Draghi; King joins US think-tank Council on Foreign Relations as a distinguished fellow
IMF greenlights new wave of funds for ‘resolute' Cyprus
New IMF report says most conditions have been met with a ‘comfortable margin' but warns that the banking crisis' impact on households and corporates could be larger than anticipated
ECB to relax CCBM collateral deposit rules from May 2014
Benoît Cœuré says the rule change will pave the way for support of cross-border, tri-party collateral management services from September next year; warns Sepa deadline looks tight for many
Hungarian economists wary of foreign bank branches
Researchers are concerned that a shift away from foreign bank subsidiaries to branches increases the risks of inadequate supervision and threatens financial stability both at home and abroad
BIS research dismisses fears over high-quality asset shortage
Article says increase in high-quality assets appears sufficient to meet rising demand, but risks could still come from elsewhere
Minutes reveal Riksbank reluctant to give up say on macro-prudential matters
Deputies say democratic accountability is more about who has the right to make decisions than achieving policy objectives; see ‘clear link' between macro-prudential policy and monetary policy
BoE's Tucker clarifies FPC's macro-prudential powers
Article gives details of the inner workings of the Financial Policy Committee, including powers of direction and recommendation, its accountability and powers to hide information from the public
Robert Pringle’s Viewpoint: Looking for a game-changer for the financial system
The world may need to look to central bank governors in countries such as China and India to champion reform of the global monetary architecture
Africa leads growth in financial inclusion, finds IMF study
Most comprehensive financial inclusion data set to date highlights rapid expansion of financial access in Africa; emphasises close links between growth and SMEs' access to finance