Financial Stability
Irish deputy governor analyses monetary policy’s role in stability
Stefan Gerlach explores the dynamic between using monetary policy and macro-prudential policy to address financial stability; says the two can be used in tandem, with considerations
Bank of Lithuania approves guidelines on financial services advertising
New guidelines aim to improve the quality and information content of financial advertising; central bank warns against ‘aggressive and non-informative’ adverts
Irish governor says senior creditors must take share of losses
Patrick Honohan wants the losses of failing banks to be shared with senior creditors; says governments’ rescue options are limited when debt is socialised
Swiss franc expected to retrace its fall as ECB news sinks in
The euro rallied against the Swiss franc for the first time in six months after yesterday’s announcement of new measures from the ECB, but FX strategists expect it to fall back towards 1.20
Swiss board member supports counter-cyclical capital buffer
Jean-Pierre Danthine examines impact of CCB on Switzerland’s financial sector; says it would have mitigated property crisis in 1990s
Filipino governor reveals domestic liquidity problem
Amando Tetangco discusses deposit and loan growth rates in the Philippines; expresses concern over excess domestic liquidity
ECB unveils details of bond purchase plans
Mario Draghi sets out plans for European Central Bank to buy debt of ailing eurozone economies; questions remain over impact
Sarb reveals details of new banknotes
South African Reserve Bank initiates national campaign about introduction of new banknotes; currency bearing image of Nelson Mandela will be in circulation by end of year
Norway releases coin to mark anniversary of suffrage
Norges Bank issues special edition coin on 100th anniversary of introduction of voting rights for women; competition winner designed reverse of coin
India’s Subbarao demands ‘radical change’ in banks’ risk management
Reserve Bank of India governor calls for a change in Indian banks’ approach to risk; says it is not just a matter of compliance for banks
Italian paper studies impact of euro break-up fears
Bank of Italy working paper investigates interest rate movements away from macroeconomic fundamentals; suggests euro break-up fears may be an influence
HKMA moves to improve retail payments system
Hong Kong unveils a three-pronged approach to improve payments system; targets transfers denominated in renminbi as well as the Hong Kong dollar
RBA paper addresses systemic risk in payments system
Research paper from Reserve Bank of Australia analyses systemic risk in RTGS payment system; evaluates Australia’s liquidity-saving algorithms
Central Bank of Nigeria rebuts ‘false rumours’ on currency plans
Statement by Nigeria’s central bank attempts to correct ‘dangerous misrepresentations’ about currency restructuring; denies accusations new 5,000 naira banknote will be costly and cause inflation
Malaysia’s Zeti encourages cross-border collaboration
Zeti Akhtar Aziz promotes the need for cooperation in achieving financial stability; outlines positive impact of this approach in Asia
Netherlands not prepared for Iban, says central bank
Netherlands Bank assessment shows awareness of Iban is rising; but businesses are not taking necessary steps for switch
Spain’s Frob reveals first tranche of funding for Bankia
Fund for Orderly Bank Restructuring agrees on initial bailout funds for BFA-Bankia; concerns raised over whether speed of recapitalisation will be sufficient to restore confidence
Central Bank of Nigeria stays firm over currency changes
List of frequently asked questions makes it clear overhaul plans are here to stay; central bank fails to offer direct response to criticism from government
SNB’s Jordan defends decision not to activate capital buffer
Thomas Jordan explains the choice not to activate counter-cyclical capital buffer; nevertheless says this is ‘far from an all-clear’ as the risk of further imbalances persists
Bank of Lithuania launches new cash management service
Cash Service opens for business in centralised location; new body aimed at reducing cost of ensuring good quality currency is in circulation in the country at all times
Fed paper estimates impact of more stringent bank supervision
Discussion paper studies changes in the stringency of the US bank ratings system ‘Camels’; finds although variation is small, closer supervision leads to a significant decline in lending
BoE executive director slates complex regulation
Andrew Haldane criticises the length of legislation recently introduced in the US and Europe; appeals for a simpler approach to financial regulation
UK banks reveal size of eurozone funding gaps
Banks reduce cross-border funding of peripheral eurozone assets in an attempt to mitigate redenomination risk - but funding gap still tops £10 billion for Spain
IMF paper tests portfolio rebalancing impact on exchange rates
Working paper studies effect of changes to equities portfolios in driving adjustments in exchange rates; finds higher stock market returns cause depreciation of currency