Regulation
Margaret Cole joins UK FSA Board
Financial Services Authority promotes Margaret Cole to board as managing director of enforcement and financial crime
Banks need more time to reform pay standards: IIF
Institute of International Finance says lenders need more than year to bring pay standards in line with Financial Stability Board’s principles; regulators must speed up coordination efforts
MEPs win out on powers for new European supervisory bodies
Pan-European authorities will have the power to impose emergency measures and intervene with financial institutions, after parliamentarians gained ground in compromise agreement
Islamic banks affected differently by crunch: IMF
IMF research finds Islamic banks outperformed conventional rivals in 2008, but trend was reversed following year
NY Fed: capital structure best left to the market
New York Fed research supports view that some degree of leverage may ensure appropriate bank behaviour
Indonesia moots new rule to boost bank lending
Bank Indonesia to propose range of loan-to-deposit ratios to encourage lending; banks prefer to park deposits in money market due to perceived default risk
JP Morgan slashes commodity desks
Fate of other prop desks unclear ahead of enactment of Volcker Rule
Core principles mostly apply to micro lenders: Basel Committee
Basel Committee on Banking Supervision issues final report on applying core principles to microfinance providers; tweaks needed on credit risk, capital adequacy and risk management
Banks’ role to be reduced in future financial system, IMF says
IMF position note says non-bank financial firms will see roles expand; IMF must refine its methods and broaden its view to keep up with changes
Basel Committee defends adjustments to Basel III as calibration decisions loom
Regulators describe difficulties ahead as they prepare for Basel III calibration and transition decisions in September
New Basel proposals threaten bank sub debt, investors warn
Bond investors voice concerns over freedom given to national regulators to determine trigger events for conversions or haircuts
UK FSA revisits trading regulation in comprehensive review
Financial Services Authority identifies valuation, capital framework coherence and risk management as key problem areas; issues 15 recommendations to revitalise standards
Basel Committee to rethink CVA capital charge
Regulators might adapt the bond-equivalent approach amid claims the methodology will lead to perverse incentives
Regulators kick off derivatives reform discussion
Market participants call for clearing decisions to be left to market forces and caution regulators about clearing house ownership
Basel bids to make bondholders pay price of failure
Basel Committee on Banking Supervision says all instruments classified as tier one and tier two capital bear some of the cost of taxpayer support
SEC makes landmark fraud charge against US state
Securities and Exchange Commission makes its first-ever case against a state, on grounds of securities fraud; New Jersey alleged to have misled bond investors on pension contributions it was making
Canada throws weight behind Basel III, lauding output gains
Bank of Canada says forthcoming capital and liquidity ratios will save the country nearly C$200 billion; stresses that Canada must not rest on laurels, not having experienced banking crisis
Banks overestimate Basel III’s impact on growth: regulators
Basel body says hiking capital ratios by one percentage point will only cause 0.19% drop in potential GDP as lower rates will cushion the blow; industry bodies remain unconvinced
Australia’s Stevens warns on dangers of over-regulation
Reserve Bank of Australia’s Glenn Stevens cautions against a return to the “intrusive” regulation seen in the United States in the 1930s
Are CoCos from cloud cuckoo-land?
The rationale for requiring banks to hold contingent capital is right. However, the mechanics of their operation and market implications may be subject to doubt, argues Charles Goodhart.
Bank's Haldane: regulators must consider changing shape and structure of finance
Executive director for financial stability at the Bank of England says regulators should reconsider the structure of financial contracts, markets, and institutions