Regulation
UK’s PRA gives small bank managers an easier ride
Prudential Regulation Authority finalises first phase of Senior Managers’ Regime, giving some concessions to small firms; more rules set to follow later this year
Hellwig and Wolf question efficacy of financial reforms
Martin Hellwig and Martin Wolf discuss flaws in financial reforms aimed at breaking the sovereign-bank linkage in book on country and political risk
RBA research finds CCP rules are effective in containing severe shocks
Paper tests central counterparties under extreme ‘tail of tail’ scenarios and finds new rules designed to promote their stability are effective
ESRB group wants treatment of sovereign debt reviewed
Report published by European Systemic Risk Board argues sovereign debt can no longer treated as risk-free, and outlines different ways the regulatory framework could be adapted
BIS paper says liquidity regulation should not replace lender of last resort function
Lender of last resort and liquidity regulations perform separate roles, and therefore one cannot replace the other, working paper says
FSB-Iosco tweaks systemic shadow bank definition after criticism
Initial proposals for identifying systemic ‘non-bank non-insurers’ ran into criticism last year, with asset managers complaining rules put too much emphasis on size
First CPMI-Iosco peer review finds gaps in trade repository principles
Peer review of Principles for Financial Market Infrastructures in Europe, Japan and the US finds jurisdictions have made good progress with CCPs, but gaps remain among trade repositories
In qualified support of coco bonds
Europe’s supervisors need to develop a code of best practice to support the prudential issuance of contingent convertible bonds, argues Andreas Dombret
UK regulators flesh out proposed punishments for bankers
Consultation papers set out details of how presumption of responsibility will work in practice, including narrowed scope, and seek to extend greater protections to whistleblowers
Islamic finance: Nigerian central bank reveals shape of advisory body
Central Bank of Nigeria publishes guidelines for the Financial Regulation Advisory Council of Experts, charged with offering ‘expert advice’ on the industry and approving new products
MAS takes first steps towards crowdfunding regulations
Proposed regulations aim to strike a balance between encouraging a valuable source of finance for small businesses and managing the high risks associated with securities-based crowdfunding
Book notes: Don’t start from here, by David Shirreff
A pointed, passionate plea for a simpler banking system that deserves to be taken seriously
IMF paper tackles puzzle of asset bubbles in efficient markets
Working paper suggests business risk for asset managers creates institutional herding and ‘rational bubble-riding’, with implications for the design of macro-prudential policies
Chan welcomes code of conduct for Hong Kong bankers
HKMA chief executive praises stricter code of conduct, which seeks to improve banking culture, promote competition and protect consumers
Fed’s Tarullo casts doubt on counter-cyclical tools
Daniel Tarullo questions ability of macro-prudential tools to temper booms and busts, and calls for a new ‘prudential market regulation’ to tackle shadow banking risks
Oman central bank toughens rules for systemic banks
Central Bank of Oman unveils framework for regulating domestic systemically important banks, including capital surcharges, stress testing, crisis management and resolution planning
BoE’s Hauser says markets review will avoid heavy-handed regulation
Andrew Hauser says UK’s Fair and Effective Markets Review will seek to achieve its aims through market discipline if possible, instead of imposing burdensome regulation
Treasury Committee attacks FCA’s use of media as ‘tool of regulation’
UK conduct regulator defends use of press to disseminate its policies, but MPs call the process ‘bizarre’ and a ‘colossal risk’
Mersch lays out path to capital markets union
ECB executive board member says harmonised regulation and ‘institutional adjustments’ needed in Europe; suggests change in securities markets
Basel III helps Russian banks handle economic turmoil, says Yudaeva
Russia’s adoption of international banking rules has given its banks partial protection from a plunging currency and soaring interest rates
Ireland’s Honohan: organisational structure to be ‘thoroughly overhauled’
Central Bank of Ireland governor details ongoing efforts to rectify the regulatory failings that led to the 2008 crisis in the country's banking system
Robert Pringle's Viewpoint: The global finance system is in bad need of repair
Muddling through is not enough: neglect of global money can trigger political earthquakes that sweep away any chance of reasonable debate and compromise
Australian banks look to stable deposits to meet LCR, says Debelle
Interest rates on more stable deposit products are rising as banks prepare for liquidity coverage ratio’s January deadline, says Reserve Bank of Australia assistant governor
Bank of Finland’s Honkapohja advocates ‘cautious and gradual’ approach to deregulation
Central bank board member offers lessons for China from Nordic experience with financial deregulation, and advocates a cautious approach over a ‘big bang’