Banks
BoE paper maps contagion via CDS market
Economists identify mechanism whereby declining creditworthiness can spill from one bank to another via credit default swaps
Basel set to decide on capital relief for accounting changes
Phase-in to IFRS 9 and Cecl needed to avert "a dramatic overnight drop in regulatory capital", say auditors
Policy tensions in China to become ‘more stark’ in 2017 – Menon
MAS head says China's authorities will have to use a fair amount of “policy dexterity” this year to deal with likely US rate rises and volatile international markets
Swift creates distributed ledger proof-of-concept
Swift, in conjunction with Hyperledger working group, will launch private distributed ledger network to help banks manage their cross-border payments
Leveraged markets not a financial stability risk – Powell
Powell examines state of highly leveraged markets with eye to financial stability, judging they are not yet a problem
BIS paper flags importance of “multi-layered” bank networks
Authors go beyond aggregate exposures to reveal “multiplex” interbank networks, which could allow more tailored policymaking
RBI research arm tests blockchain for clearing, settlement
IDRBT releases white paper on the applications of blockchain, examining the benefits for the Indian financial sector; research group created proof-of-concept architecture to simulate clearing network
Central Bank of Brazil sets out agenda for 2017
Improved governance and financial inclusion at the top of the list for the central bank; aims have been published on an innovative interactive webpage
Chile notes health of domestic economy has declined
Latest financial stability report highlights the lack of profitability in the banking sector; institutions’ ability to cope with adverse external scenarios has “diminished”
Yellen underlines the importance of education for the economy
Globalisation and technology are driving the demand for educated workers, Fed chair says, emphasising the important role education has to play in the evolving US economy
European agencies see pitfalls in growing big data use
Financial products likely to become more tailored to consumers, but that will not benefit everyone, regulators warn
Ukraine nationalises country’s largest bank
Gontareva says PrivatBank failed repeatedly to take necessary action, and so will be transferred into public ownership; central bank creates emergency liquidity facility
Sarb fines two major commercial banks for AML breaches
“Administrative sanctions” placed on Societe Generale Johannesburg branch and Absa Bank after staff found “weaknesses” in AML and terrorist-financing control measures
IMF paper shows US monetary conditions impact EM leverage
Impact is more pronounced for firms that are dependent on external financing, authors find; sample shows financial conditions have the ability to influence borrowing constraints
RBI paper unpacks India’s non-performing loan troubles
Authors find bank risk-taking is procyclical and the level of non-performing loans responds to the interest rate environment and the overall growth of the economy
IMF delay forces National Bank of Ukraine to keep forex controls
Central bank to leave foreign exchange controls in place until political instability subsides and reforms are under way; IMF acknowledges progress, but says more is needed before the third review
BoE’s Woods: firms favour ‘transitional’ Brexit period
Prudential Regulation Authority chief quizzed on best course of action for financial firms during Brexit process; “preferential” market access is not necessary, but seems sensible, he says
US agencies reject Wells Fargo resolution plan
Bank faces further curbs on its activities if it cannot present the Fed and FDIC with a sufficiently improved plan by early 2017
Eight banks struggle in Czech stress tests
Adverse scenario pushes many banks below regulatory capital minimums, though the system as a whole remains resilient, central bank says
Kganyago warns of ‘importing structural instability’
Sarb governor highlights impact of global banking regulation on South African economy, as Barclays prepares to pull out of the continent
BoE studies effects of capital requirements on balance sheets
After the financial crisis, banks placed more emphasis on asset deleveraging and adjusted their capital management practices
Central banks ‘critical’ in the development of blockchain
Large South African commercial bank examines what a central bank digital currency would look like, coining the phrase “sovereign blockchain”
IMF paper offers more granular stress testing framework
IMF applies new stress testing framework to Ecuador’s banking sector; framework offers more efficient surveillance, authors argue
SAMA governor outlines challenges facing Islamic banking sector
Unified accounting standards would “comfort” regulators and improve transparency for the industry, Alkholifey says; issues need to be addressed in order to foster growth in Islamic banking