The Case for a Structural Reform, The Proposals of the High level Expert Group

Size: px
Start display at page:

Download "The Case for a Structural Reform, The Proposals of the High level Expert Group"

Transcription

1 The Case for a Structural Reform, The Proposals of the High level Expert Group 12 February 2013, Helsinki Governor Erkki Liikanen Chairman of the High level Expert Group SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND

2 The Group s mandate Assess whether banking structures need changes in order to 1. achieve a safe, stable, and efficient banking system, 2. which provides for the needs of the EU citizens, the EU economy and the Internal Market Take account of the on-going regulatory reforms especially capital adequacy regulations and the Commission s recovery and resolution proposal Assess the existing structural reform proposals Vickers report, Volcker rule/dodd-frank Act SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 2

3 Rapid growth in the EU banking sector Total assets of MFIs in EU Note: Bar charts show total t assets, dotted d line shows assets as % of GDP Source: ECB data as presented in High-level Expert Group Final Report SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 3

4 Shifts in focus of operations as illustrated by shifts in assets structures Evolution of assets of MFIs in EU the euro area ( billion) Notes: Customer loans are loans to non-monetary financial institutions excluding general government Source: ECB data as presented in High-level Expert Group Final Report SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 4

5 Increased leverage as illustrated by shifts in funding structures Evolution of liabilities of MFIs in the euro area ( billion) Notes: Customer deposits are deposits of non-monetary financial institutions excluding general government. Source: ECB data as presented in High-level Expert Group Final Report SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 5

6 Implicit subsidies remain high Credit ratings and systemic support uplift for a sample of EU and US banks (previous and current after downgrade d in 6/2012) Source: Moody's (2012) as presented in High-level Expert Group Final Report SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 6

7 Insufficiencies in capital requirements on trading book positions Capital requirements for market risk for large EU banks (2011, as % of trading assets) Notes: Capital requirements calculated as 8% of RWA for market risk Source: Data from Bloomberg as presented in High-level Expert Group Final Report SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 7

8 Focus of current regulatory reforms Regulatory reforms have been focused on two crucial areas Capital adequacy and liquidity requirements as set by Basel III and implemented in EU by means of regulation and a directive The Commission s recovery and resolution framework The regulatory reform will, at least to some extent improve the resilience of banks, reduce incentives for excessive risk taking and leverage, reduce complexity and interconnectedness and reduce the social costs of bank failure and the need for implicit government guarantees SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 8

9 Two avenues as a possible way forward were considered Avenue 1 Avenue 2 A non-risk weighted capital requirement is imposed on trading activities. Conditional separation of activities is imposed, if the bank cannot prove that the required recovery and resolution plan is credible. Mandatory separation of retail banking and investment banking is imposed on banks. Cf. Darrell Duffie Cf. Alan Blinder SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 9

10 The five proposals of the High-level Expert Group 1. Mandatory separation to deposit bank and trading entity 2. Additional separation requirement If the recovery and resolution plan otherwise not credible 3. Bail-in instruments Pre-defined scope and terms to facilitate pricing and liquidity 4. A review of capital requirements on trading assets and real estate related loans 5. Strengthening the governance and control of banks Including the use of bail-in instruments in compensation SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 10

11 The High-level Expert Group s proposal for mandatory separation Activities separated to the trading entity : Proprietary trading and market-making ki Loans, loan commitments and unsecured credit exposure to hedge funds, SIVs, and private equity investments Activities which are permitted to deposit banks : Hedged, client-driven transactions that fall within narrow risk position limits Securities underwriting Activities permitted only to deposit banks Insured deposits and supply of retail payment services Restrictions on transfers and exposures between the separated entities The entities can be operated within a banking group SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 11

12 Proprietary trading Market making HF, PE, SIV loans Retail payments Lending Securities underwriting Forex and interest rate swaps Trading entity Restrictions on transfers and risk exposures Deposit bank Capital Funding from the market Insured deposits Capital Funding from the market Liikanen Group s proposal SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 12

13 Rationale for mandatory separation Prohibit banks with insured deposits from engaging g g in trading activities whose risks are potentially high and difficult to measure precisely Complements risk-based capital requirements Reduce complexity and interconnectedness Facilitates recovery and resolution and thus helps make it credible Enhances bank management and supervision Makes the pricing of funding of the separated entities more efficient and risk-based Reduce mixing of management cultures One-stop shopping still possible SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 13

14 Mandatory separation aim to tackle some of the problems in EU banking identified by HLEG Identified problem by HLEG Excessive risk-taking in trading, lending, funding Complexity (making bank management, monitoring, supervision and resolution challenging) Limited loss absorbency Intra-group subsidies Ineffective governance and control Result Increased probability of failure Interconnectedness Limited resolvability Bank-sovereign feedback loop Increased impact of failure Inadequate EU institutional framework Excessive focus on intra-financial business, as opposed to real economy Competitive distortions and implicit subsidies Inadequate consumer protection Reduced internal market efficiency and level playing field SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 14

15 Comparison of suggested structural reforms Volcker banking group Proprietary trading, Hedge fund (HF) and Private equity (PE) exposures HLEG banking group Market making Swaps push-out Investment and commercial banking Proprietary trading Market making HF, PE and SIV unsecured exposures Investment, commercial and retail banking Vickers banking group Investment and commercial banking, Proprietary trading, Market making Retail banking with higher capital requirements SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 15

16 Comparison of the structural proposals p HLEG vs. Vickers Vickers ring-fences deposit banking, HLEG separates high-risk trading Differences: Vickers deposit bank with higher capital requirements Securities underwriting not allowed in Vickers deposit bank Restrictions regarding g non-eea customers in Vickers deposit bank HLEG vs. Volcker HLEG avoids the fine line between proprietary trading and market making Volcker Rule pushes proprietary trading outside banks. This has been criticized for definitional problems and potential market liquidity and stability implications. SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 16

17 HLEG s proposals 2 and 3 (to further support recovery and resolution) 2) Wider than mandatory separation should be possible, if a credible recovery and resolution plan for a bank so requires 3) Improving the market for bail-in instruments If a bank in financial distress, bail-inable inable debt can take a haircut or be converted into equity Clear contractual terms make pricing more efficient and support liquidity Issuance up to a certain amount to non-financial investors SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 17

18 Proposals 4 and 5 4) Capital requirements review The Commission should assess whether the outcome of Basel Committee s review of trading book capital requirements is sufficient for covering risks in the EU A similar review recommended on capital requirements on real estate related loans 5) Enhancing corporate governance and control in banks Risk management function should have a more central role Curbing size and improving incentives of compensation Improving risk reporting SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 18

19 On the role of banking Banks play an important role in the society Provide payment services to ease trade Mobilise and pool savings and allocate these to investments Engage in maturity transformation Manage risk on behalf of less sophisticated stakeholders Banks have a pivotal role in providing finance to the real sector particularly in Europe Strengthening banks ability to provide socially vital financial services efficiently and in a stable manner benefits our societies at large SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND 19

20 Thank you! SUOMEN PANKKI FINLANDS BANK BANK OF FINLAND

How to improve financial stability and resilience of systemically important financial institutions after the crisis?

How to improve financial stability and resilience of systemically important financial institutions after the crisis? How to improve financial stability and resilience of systemically important financial institutions after the crisis? EBA Policy Research Workshop How to regulate and resolve systemically important banks

More information

Agenda. Structural reform in the EU banking sector. Advancing economics in business

Agenda. Structural reform in the EU banking sector. Advancing economics in business Agenda Advancing economics in business Structural reform in the EU banking sector Structural reform in the EU banking sector The High-level Expert Group on reforming the structure of the EU banking sector

More information

Governor Erkki Liikanen Bank of Finland. Monetary policy and its transmission to the economy

Governor Erkki Liikanen Bank of Finland. Monetary policy and its transmission to the economy Governor Erkki Liikanen Bank of Finland Monetary policy and its transmission to the economy 9.6.2015 1 1. Commitment to accommodative monetary policy benefits the economic outlook 2 Interest rate policy

More information

Implications of the SSM for the Nordic banking sector. Stefan Ingves, June 5 2014

Implications of the SSM for the Nordic banking sector. Stefan Ingves, June 5 2014 Implications of the SSM for the Nordic banking sector Stefan Ingves, June 5 2014 Financial trilemma Financial stability Financial integration National supervision Arrangements for cross-border cooperation

More information

Key learning points I

Key learning points I Key learning points I What do banks do? Banks provide three core banking services Deposit collection Payment arrangement Underwrite loans Banks may also offer financial services such as cash, asset, and

More information

What is new in Basel 3:

What is new in Basel 3: Camera dei Deputati 17 Indagine conoscitiva 4 ALLEGATO What is new in Basel 3: How it will influence market participants Krishnan Ramadurai Managing Director Camera dei Deputati 18 Indagine conoscitiva

More information

Statement by. Ben S. Bernanke. Chairman. Board of Governors of the Federal Reserve System. before the

Statement by. Ben S. Bernanke. Chairman. Board of Governors of the Federal Reserve System. before the For release on delivery 9:30 a.m. EDT May 12, 2011 Statement by Ben S. Bernanke Chairman Board of Governors of the Federal Reserve System before the Committee on Banking, Housing, and Urban Affairs U.S.

More information

Net Stable Funding Ratio

Net Stable Funding Ratio Net Stable Funding Ratio Aims to establish a minimum acceptable amount of stable funding based on the liquidity characteristics of an institution s assets and activities over a one year horizon. The amount

More information

RISK FACTORS AND RISK MANAGEMENT

RISK FACTORS AND RISK MANAGEMENT Bangkok Bank Public Company Limited 044 RISK FACTORS AND RISK MANAGEMENT Bangkok Bank recognizes that effective risk management is fundamental to good banking practice. Accordingly, the Bank has established

More information

The Financial Crises of the 21st Century

The Financial Crises of the 21st Century The Financial Crises of the 21st Century Workshop of the Austrian Research Association (Österreichische Forschungsgemeinschaft) 18. - 19. 10. 2012 Towards a Unified European Banking Market Univ.Prof. Dr.

More information

International competition will change mortgage lending

International competition will change mortgage lending Pentti Hakkarainen Deputy Governor, Bank of Finland International competition will change mortgage lending Nordic Mortgage Council Helsinki, 28 August 2015 28.8.2015 Unrestricted 1 Financial stability

More information

EBA final draft Regulatory Technical Standards

EBA final draft Regulatory Technical Standards EBA/RTS/2014/11 18 July 2014 EBA final draft Regulatory Technical Standards on the content of recovery plans under Article 5(10) of Directive 2014/59/EU establishing a framework for the recovery and resolution

More information

Basel 3: A new perspective on portfolio risk management. Tamar JOULIA-PARIS October 2011

Basel 3: A new perspective on portfolio risk management. Tamar JOULIA-PARIS October 2011 Basel 3: A new perspective on portfolio risk management Tamar JOULIA-PARIS October 2011 1 Content 1. Basel 3 A complex regulatory framework With possible unintended consequences 2. Consequences on Main

More information

Liquidity Coverage Ratio

Liquidity Coverage Ratio Liquidity Coverage Ratio Aims to ensure banks maintain adequate levels of unencumbered high quality assets (numerator) against net cash outflows (denominator) over a 30 day significant stress period. High

More information

The Ratio of Leverage. When you combine ignorance and leverage, you get some pretty interesting results. Warren Buffett

The Ratio of Leverage. When you combine ignorance and leverage, you get some pretty interesting results. Warren Buffett The Ratio of Leverage When you combine ignorance and leverage, you get some pretty interesting results. Warren Buffett 1 What is leverage? definition of leverage: debt to equity ratio Basel Commitee: One

More information

Opening remarks The current economic situation

Opening remarks The current economic situation Opening remarks Anneli Tuominen, Director General of Finnish Financial Supervisory Authority at the 4 th FIN-FSA Conference on EU Regulation and Supervision in Helsinki on 9 June 2015. Introduction Dear

More information

Dodd-Frank Act: Impact on Business and IT

Dodd-Frank Act: Impact on Business and IT White Paper Dodd-Frank Act: Impact on Business and IT - Vibhash Prakash Awasthi, Hemant Shashikant Dandegaonkar, Abhishek Prasad Mokal Abstract The Dodd-Frank Act (DFA), which was first proposed in fall

More information

05.11.2013. Closing Speech by the Governor of the Banco de España 6th Santander International Banking Conference Luis M.

05.11.2013. Closing Speech by the Governor of the Banco de España 6th Santander International Banking Conference Luis M. 05.11.2013 Closing Speech by the Governor of the Banco de España 6th Santander International Banking Conference Luis M. Linde Governor I would like first to give my thanks to Banco de Santander for inviting

More information

THE REGULATORY LANDSCAPE IS CHANGING, ARE YOU READY? RECENT UPDATES TO PRA AND TLAC STANDARDS

THE REGULATORY LANDSCAPE IS CHANGING, ARE YOU READY? RECENT UPDATES TO PRA AND TLAC STANDARDS THE REGULATORY LANDSCAPE IS CHANGING, ARE YOU READY? RECENT UPDATES TO PRA AND TLAC STANDARDS PRA OPERATIONAL CONTINUITY REQUIREMENTS FURTHER ENHANCEMENTS BUT GREATER COSTS 15 October saw the release of

More information

Definition of Capital

Definition of Capital Definition of Capital Capital serves as a buffer to absorb unexpected losses as well as to fund ongoing activities of the firm. A number of substantial changes have been made to the minimum level of capital

More information

EBA-GL-2015-02. 23 July 2015. Guidelines. on the minimum list of qualitative and quantitative recovery plan indicators

EBA-GL-2015-02. 23 July 2015. Guidelines. on the minimum list of qualitative and quantitative recovery plan indicators EBA-GL-2015-02 23 July 2015 Guidelines on the minimum list of qualitative and quantitative recovery plan indicators Contents EBA Guidelines on the minimum list of qualitative and quantitative recovery

More information

ESM direct bank recapitalisation instrument -Main features of the operational framework and way forward -

ESM direct bank recapitalisation instrument -Main features of the operational framework and way forward - Luxembourg, 20 June 2013 ESM direct bank recapitalisation instrument -Main features of the operational framework and way forward - Following the 29 June 2012 statement by the Heads of State or Government

More information

How do we get banks to better serve the real economy: ethics, incentives, and the role of supervisors

How do we get banks to better serve the real economy: ethics, incentives, and the role of supervisors How do we get banks to better serve the real economy: ethics, incentives, and the role of supervisors Washington, June 3, 2015 1. The financial crisis highlighted severe weaknesses and excesses in the

More information

Financial stability, systemic risk & macroprudential supervision: an actuarial perspective

Financial stability, systemic risk & macroprudential supervision: an actuarial perspective Financial stability, systemic risk & macroprudential supervision: an actuarial perspective Paul Thornton International Actuarial Association Presentation to OECD Insurance and Pensions Committee June 2010

More information

CANADIAN TIRE BANK. BASEL PILLAR 3 DISCLOSURES December 31, 2014 (unaudited)

CANADIAN TIRE BANK. BASEL PILLAR 3 DISCLOSURES December 31, 2014 (unaudited) (unaudited) 1. SCOPE OF APPLICATION Basis of preparation This document represents the Basel Pillar 3 disclosures for Canadian Tire Bank ( the Bank ) and is unaudited. The Basel Pillar 3 disclosures included

More information

Impact of Basel III Liquidity Requirements on the Payments Industry

Impact of Basel III Liquidity Requirements on the Payments Industry Cards & Payments the way we see it Impact of Basel III Liquidity Requirements on the Payments Industry Liquidity management strategy for banks providing payment services Table of Contents 1. Summary 3

More information

BVI s position on the Consultative Document of the Basel Committee on Banking Supervision: Capital requirements for banks equity investments in funds

BVI s position on the Consultative Document of the Basel Committee on Banking Supervision: Capital requirements for banks equity investments in funds Frankfurt am Main, 4 October 2014 BVI s position on the Consultative Document of the Basel Committee on Banking Supervision: Capital requirements for banks equity investments in funds BVI 1 gladly takes

More information

Independent Commission on Banking. Investment Management Association response to Interim Report

Independent Commission on Banking. Investment Management Association response to Interim Report Independent Commission on Banking Investment Management Association response to Interim Report The IMA represents the investment management industry in the UK. Its members managed a total of 3.9 trillion

More information

Risk & Capital Management under Basel III

Risk & Capital Management under Basel III www.pwc.com Risk & Capital Management under Basel III London, 15 Draft Agenda Basel III changes to capital rules - Definition of capital - Minimum capital ratios - Leverage ratio - Buffer requirements

More information

On Corporate Debt Restructuring *

On Corporate Debt Restructuring * On Corporate Debt Restructuring * Asian Bankers Association 1. One of the major consequences of the current financial crisis is the corporate debt problem being faced by several economies in the region.

More information

The Relationship between Capital, Liquidity and Risk in Commercial Banks. by Tamara Kochubey and Dorota Kowalczyk. Comments by Ricardo Lago

The Relationship between Capital, Liquidity and Risk in Commercial Banks. by Tamara Kochubey and Dorota Kowalczyk. Comments by Ricardo Lago The Relationship between Capital, Liquidity and Risk in Commercial Banks by Tamara Kochubey and Dorota Kowalczyk Comments by Ricardo Lago I- Motivation and Method U.S. commercial banks : decision making

More information

Q3 INTERIM MANAGEMENT STATEMENT Presentation to analysts and investors. 28 October 2014

Q3 INTERIM MANAGEMENT STATEMENT Presentation to analysts and investors. 28 October 2014 INTERIM MANAGEMENT STATEMENT Presentation to analysts and investors 28 October HIGHLIGHTS FOR THE FIRST NINE MONTHS OF Continued successful execution of our strategy and further improvement in financial

More information

Liquidity and the Development of Robust Corporate Bond Markets

Liquidity and the Development of Robust Corporate Bond Markets Liquidity and the Development of Robust Corporate Bond Markets Marti G. Subrahmanyam Stern School of Business New York University For presentation at the CAMRI Executive Roundtable Luncheon Talk National

More information

Overcoming the Crisis

Overcoming the Crisis Overcoming the Crisis Klaus Regling, Managing Director, ESM Bank of Greece Athens, 10 July 2014 Reasons for the crisis The crisis was caused by a very specific mix of circumstances: Excessive deficit/debt

More information

The Contribution of Trade in Financial Services to Economic Growth and Development

The Contribution of Trade in Financial Services to Economic Growth and Development The Contribution of Trade in Financial Services to Economic Growth and Development 26 June 2012 Mina Mashayekhi Head Trade Negotiations and Commercial Diplomacy Branch, DITC/UNCTAD Outline 1. Financial

More information

Lecture 10: International banking

Lecture 10: International banking Lecture 10: International banking The sessions so far have focused on banking in a domestic context. In this lecture we are going to look at the issues which arise from the internationalisation of banking,

More information

Bank Liabilities Survey. Survey results 2013 Q3

Bank Liabilities Survey. Survey results 2013 Q3 Bank Liabilities Survey Survey results 13 Q3 Bank Liabilities Survey 13 Q3 Developments in banks balance sheets are of key interest to the Bank of England in its assessment of economic conditions. Changes

More information

Response to European Commission Consultation Document on Undertakings for Collective Investment in Transferable Securities ( UCITS )

Response to European Commission Consultation Document on Undertakings for Collective Investment in Transferable Securities ( UCITS ) Association for Financial Markets in Europe Response to European Commission Consultation Document on Undertakings for Collective Investment in Transferable Securities ( UCITS ) 24 October 2012 The Association

More information

Impact of the financial crisis and bank failure

Impact of the financial crisis and bank failure Impact of the financial crisis and bank failure Professor Julian Franks London Business School July 2009 Introduction Some questions and issues which will affect the future of the financial services industry.

More information

FROM: James Ballentine, Executive Vice President, Congressional Relations and Public Policy

FROM: James Ballentine, Executive Vice President, Congressional Relations and Public Policy James Ballentine Executive Vice President Congressional Relations and Political Affairs 202-663-5359 jballent@aba.com April 17, 2014 TO: Members of the Senate Banking Committee FROM: James Ballentine,

More information

Questions and answers

Questions and answers Questions and answers DATE: 25 November 2011 DEPARTMENT: Financial stability department SVERIGES RIKSBANK SE-103 37 Stockholm (Brunkebergstorg 11) Tel +46 8 787 00 00 Fax +46 8 21 05 31 registratorn@riksbank.se

More information

The EMU and the debt crisis

The EMU and the debt crisis The EMU and the debt crisis MONETARY POLICY REPORT FEBRUARY 212 43 The debt crisis in Europe is not only of concern to the individual debt-ridden countries; it has also developed into a crisis for the

More information

What Investors Should Know about Money Market Reforms

What Investors Should Know about Money Market Reforms What Investors Should Know about Money Market Reforms What Investors Should Know about Money Market Reforms Executive Summary Ò New SEC regulations for the $2.7 trillion money market industry may present

More information

Long term financing for housing in Europe

Long term financing for housing in Europe Long term financing for housing in Europe 4th September 2015 Rio de Janeiro Christian König Association of Private Bausparkassen representative of our members interests (12 Bausparkassen) towards politics,

More information

Prof Kevin Davis Melbourne Centre for Financial Studies. Current Issues in Bank Capital Planning. Session 4.4

Prof Kevin Davis Melbourne Centre for Financial Studies. Current Issues in Bank Capital Planning. Session 4.4 Enhancing Risk Management and Governance in the Region s Banking System to Implement Basel II and to Meet Contemporary Risks and Challenges Arising from the Global Banking System Training Program ~ 8 12

More information

Mediterranean Guarantees

Mediterranean Guarantees A newsletter on risk mitigation instruments for infrastructure investment in the Mediterranean Issue 2, October 2013 The Investment Security in the Mediterranean (ISMED) Support Programme seeks to increase

More information

Bank of America Merrill Lynch Banking & Insurance CEO Conference Bob Diamond

Bank of America Merrill Lynch Banking & Insurance CEO Conference Bob Diamond 4 October 2011 Bank of America Merrill Lynch Banking & Insurance CEO Conference Bob Diamond Thank you and good morning. It s a pleasure to be here and I d like to thank our hosts for the opportunity to

More information

Economic Commentaries

Economic Commentaries n Economic Commentaries In its Financial Stability Report 214:1, the Riksbank recommended that a requirement for the Liquidity Coverage Ratio (LCR) in Swedish kronor be introduced. The background to this

More information

House Committee on Financial Services. November 29, 2012

House Committee on Financial Services. November 29, 2012 House Committee on Financial Services Joint Hearing Before the Subcommittee on Financial Institutions and Consumer Credit and the Subcommittee on Insurance, Housing and Community Opportunity Entitled Examining

More information

Leverage OTC Clearing & Interdealer Risk Management

Leverage OTC Clearing & Interdealer Risk Management OTC Clearing, Volcker Rule and Transaction Strategy: Changing market dynamics & liquidity for Corporate Treasurers Presented by Larry Tabb (Founder & CEO) PRMIA Global Risk Conference New York, NY May

More information

During the Fall of 2008, the financial industry as a whole experienced a challenging environment for funding and liquidity as a result of the global economic crisis. Goldman Sachs has, for many years,

More information

International Monetary and Financial Committee

International Monetary and Financial Committee International Monetary and Financial Committee Twenty-Seventh Meeting April 20, 2013 Statement by Koen Geens, Minister of Finance, Ministere des Finances, Belgium On behalf of Armenia, Belgium, Bosnia

More information

General Electric Company Financial Services Funding Policy

General Electric Company Financial Services Funding Policy General Electric Company Financial Services Funding Policy "This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking

More information

The euro area economy, ECB monetary policy and its transmission in the euro area and Finland

The euro area economy, ECB monetary policy and its transmission in the euro area and Finland Suomen Pankki The euro area economy, ECB monetary policy and its transmission in the euro area and Finland Euro & talous, 9 June 2016 1 Euro area economic growth is broadly based, but inflation still slow.

More information

Policy on the Management of Country Risk by Credit Institutions

Policy on the Management of Country Risk by Credit Institutions 2013 Policy on the Management of Country Risk by Credit Institutions 1 Policy on the Management of Country Risk by Credit Institutions Contents 1. Introduction and Application 2 1.1 Application of this

More information

FITCH UPGRADES ABN AMRO TO 'A+'; OUTLOOK STABLE

FITCH UPGRADES ABN AMRO TO 'A+'; OUTLOOK STABLE FITCH UPGRADES ABN AMRO TO 'A+'; OUTLOOK STABLE Fitch Ratings-London-14 April 2016: Fitch Ratings has upgraded ABN AMRO N.V.'s Long-Term Issuer Default Rating (IDR) to 'A+' from 'A', and affirmed the bank's

More information

Danish Bank Packages. 11 November 2011

Danish Bank Packages. 11 November 2011 Danish Bank Packages 11 November 2011 Danish bank packages Timeline, contents and purpose of the bank packages (BP I to IV) BP I: Stability Package (8 October 2008 to 30 September 2010) Unlimited state

More information

Real Estate in Europe. Update on regulatory developments. Ad Buisman

Real Estate in Europe. Update on regulatory developments. Ad Buisman Real Estate in Europe Update on regulatory developments Ad Buisman Update on regulatory development May 22, 2012 Page 2 Key regulations that will impact the real estate funds industry Regulations that

More information

Interim Report 2 nd quarter 2014 Nordea Eiendomskreditt AS

Interim Report 2 nd quarter 2014 Nordea Eiendomskreditt AS Interim Report 2 nd quarter 2014 Nordea Eiendomskreditt AS Nordea Eiendomskreditt AS is part of the Nordea group. Nordea s vision is to be a Great European bank, acknowledged for its people, creating superior

More information

Independent Commission on Banking Final Report on UK Banking Reform

Independent Commission on Banking Final Report on UK Banking Reform Independent Commission on Banking Final Report on UK Banking Reform 13 September 2011 1. Introduction The UK Independent Commission on Banking (the ICB ) published its final report on 12 September 2011.

More information

Agencies Adopt Final Rules Implementing The Volcker Rule; Federal Reserve Board Extends Conformance Period

Agencies Adopt Final Rules Implementing The Volcker Rule; Federal Reserve Board Extends Conformance Period CLIENT MEMORANDUM Agencies Adopt Final Rules Implementing The Volcker Rule; Federal Reserve Board Extends December 18, 2013 AUTHORS David S. Katz Jack I. Habert Laura P. Gavenman On December 10, 2013,

More information

Basis of the Financial Stability Oversight Council s Final Determination Regarding General Electric Capital Corporation, Inc.

Basis of the Financial Stability Oversight Council s Final Determination Regarding General Electric Capital Corporation, Inc. Introduction Basis of the Financial Stability Oversight Council s Final Determination Regarding General Electric Capital Corporation, Inc. Pursuant to section 113 of the Dodd-Frank Wall Street Reform and

More information

Strengthening the banking union and the regulatory treatment of banks sovereign exposures Informal ECOFIN, April 22, 2016 Presidency note

Strengthening the banking union and the regulatory treatment of banks sovereign exposures Informal ECOFIN, April 22, 2016 Presidency note Strengthening the banking union and the regulatory treatment of banks sovereign exposures Informal ECOFIN, April 22, 2016 Presidency note Introduction One of the key priorities of the Dutch Presidency

More information

Macroprudential Policies in Korea

Macroprudential Policies in Korea 1 IMF-Riksbank Conference Stockholm, November 13~14, 2014 Macroprudential Policies in Korea Tae Soo Kang Disclaimer This presentation represents the views of the author and not necessarily those of the

More information

Debt Overhang and Capital Regulation

Debt Overhang and Capital Regulation Debt Overhang and Capital Regulation Anat Admati INET in Berlin: Rethinking Economics and Politics The Challenge of Deleveraging and Overhangs of Debt II: The Politics and Economics of Restructuring April

More information

Regulating Shadow Banking. Patrick Bolton Columbia University

Regulating Shadow Banking. Patrick Bolton Columbia University Regulating Shadow Banking Patrick Bolton Columbia University Outline 1. Maturity Mismatch & Financial Crises: a classic story Low interest rates and lax monetary policy Real estate boom 2. New twist in

More information

FITCH AFFIRMS NORWEGIAN SAVINGS BANKS

FITCH AFFIRMS NORWEGIAN SAVINGS BANKS FITCH AFFIRMS NORWEGIAN SAVINGS BANKS Fitch Ratings-London-04 November 2015: Fitch Ratings has affirmed SpareBank 1 Nord-Norge's (SNN) Long-term Issuer Default Rating (IDR) at 'A', SpareBank 1 SMN's (SMN),

More information

Keynote Speech, EIB/IMF Meeting, 23 October, Brussels

Keynote Speech, EIB/IMF Meeting, 23 October, Brussels Keynote Speech, EIB/IMF Meeting, 23 October, Brussels Governor Carlos Costa Six years since the onset of the financial crisis in 2008, output levels in the EU are below those observed before the crisis.

More information

18 ECB STYLISED FACTS OF MONEY AND CREDIT OVER THE BUSINESS CYCLE

18 ECB STYLISED FACTS OF MONEY AND CREDIT OVER THE BUSINESS CYCLE Box 1 STYLISED FACTS OF MONEY AND CREDIT OVER THE BUSINESS CYCLE Over the past three decades, the growth rates of MFI loans to the private sector and the narrow monetary aggregate M1 have displayed relatively

More information

Final report. Guidelines on the minimum list of qualitative and quantitative recovery plan indicators EBA-GL-2015-02. 6 May 2015

Final report. Guidelines on the minimum list of qualitative and quantitative recovery plan indicators EBA-GL-2015-02. 6 May 2015 EBA-GL-2015-02 6 May 2015 Final report Guidelines on the minimum list of qualitative and quantitative recovery plan indicators 1 Contents 1. Executive Summary 3 2. Background and rationale 5 3. EBA Guidelines

More information

Financial Stability Oversight Council. Staff Guidance. Methodologies Relating to Stage 1 Thresholds. June 8, 2015

Financial Stability Oversight Council. Staff Guidance. Methodologies Relating to Stage 1 Thresholds. June 8, 2015 Financial Stability Oversight Council Staff Guidance Methodologies Relating to Stage 1 Thresholds June 8, 2015 Stage 1 Overview Section 113 of the Dodd-Frank Wall Street Reform and Consumer Protection

More information

Comments on the Basel Committee on Banking Supervision s Consultative Document: Supervisory framework for measuring and controlling large exposures

Comments on the Basel Committee on Banking Supervision s Consultative Document: Supervisory framework for measuring and controlling large exposures June 28, 2013 Comments on the Basel Committee on Banking Supervision s Consultative Document: Supervisory framework for measuring and controlling large exposures Japanese Bankers Association We, the Japanese

More information

Simplicity in the financial sector

Simplicity in the financial sector Simplicity in the financial sector Ladies and gentlemen, Thank you for inviting me to speak at the Risk Minds conference today, also as this enables me to congratulate you on its 20 th edition. Twenty

More information

Securitization Perspectives: Final U.S. Liquidity Coverage Ratio. September 10, 2014

Securitization Perspectives: Final U.S. Liquidity Coverage Ratio. September 10, 2014 Securitization Perspectives: Final U.S. Liquidity Coverage Ratio September 10, 2014 Introduction! On September 3rd, the Agencies adopted regulations implementing a liquidity coverage ratio (LCR) requirement

More information

ESBG Position Paper on the consultation on banking reform ESBG (European Savings Banks Group)

ESBG Position Paper on the consultation on banking reform ESBG (European Savings Banks Group) ESBG Position Paper on the consultation on banking reform ESBG (European Savings Banks Group) Rue Marie-Thérèse, 11 - B-1000 Brussels ESBG Register ID 8765978796-80 May 2012 Doc 0600/2012 ESBG s responses

More information

Quarterly Financial Supplement - 1Q 2016

Quarterly Financial Supplement - 1Q 2016 Quarterly Financial Supplement - 1Q 2016 Page # Consolidated Financial Summary... 1 Consolidated Income Statement Information... 2 Consolidated Financial Information and Statistical Data... 3 Consolidated

More information

Bank of Queensland Limited

Bank of Queensland Limited APRA 30 April 2012 The Basel II Capital Accord principles took effect in Australia on 1 January 2008. The framework for the application of Basel II in Australia is comprised of three pillars: Pillar 1:

More information

Structural Banking Reforms

Structural Banking Reforms 27 October 2014 Structural Banking Reforms Cross-border consistencies and global financial stability implications Report to G20 Leaders for the November 2014 Summit Contents Page Executive Summary... 1

More information

Financial Research Advisory Committee Liquidity and Funding Working Group. August 1, 2013

Financial Research Advisory Committee Liquidity and Funding Working Group. August 1, 2013 Financial Research Advisory Committee Liquidity and Funding Working Group August 1, 2013 Executive Summary Overview The Liquidity and Funding Working Group of the FSRM focused its work efforts around the

More information

Public consultation on the possibility for an investment fund to originate loans

Public consultation on the possibility for an investment fund to originate loans Public consultation on the possibility for an investment fund to originate loans The purpose of this consultation is to gather the opinions of all interested parties about the possibility for French investment

More information

ASF: The French Association of Specialised Finance Companies

ASF: The French Association of Specialised Finance Companies ASF: The French Association of Specialised Finance Companies Created under the regulatory framework of the banking act of 24 January 1984, the ASF (the French Association of Specialised Finance Companies)

More information

AFG would like to stress an important issue which is the way entities enter into these operations.

AFG would like to stress an important issue which is the way entities enter into these operations. AGA n 4342/Div FSB Secretariat of the Financial Stability Board, c/o Bank for International Settlements, CH-4002, Basel, Switzerland Paris, 15 December 2014 AFG response to the FSB s consultation on Strengthening

More information

Chart 1: Value of Investment Funds Shares/Units Q2 2011 Q3 2010 Q1 2011 Q4 2010

Chart 1: Value of Investment Funds Shares/Units Q2 2011 Q3 2010 Q1 2011 Q4 2010 Information Release 14 December 2012 Central Bank Data on Investment Funds 1 The Central Bank today publishes statistics for 2012 on investment funds (IFs) resident in Ireland. IFs, measured by total shares/units

More information

Glass Steagall Legislation

Glass Steagall Legislation Glass Steagall Legislation This article is about four specific provisions of the Banking Act of 1933, which is also called the Glass-Steagall Act. The term Glass Steagall Act usually refers to four provisions

More information

Basel II. Tamer Bakiciol Nicolas Cojocaru-Durand Dongxu Lu

Basel II. Tamer Bakiciol Nicolas Cojocaru-Durand Dongxu Lu Basel II Tamer Bakiciol Nicolas Cojocaru-Durand Dongxu Lu Roadmap Background of Banking Regulation and Basel Accord Basel II: features and problems The Future of Banking regulations Background of Banking

More information

The challenge of liquidity and collateral management in the new regulatory landscape

The challenge of liquidity and collateral management in the new regulatory landscape The challenge of liquidity and collateral management in the new regulatory landscape ICMA Professional Repo and Collateral Management Course 2012 Agenda 1. Background: The repo product under pressure 2.

More information

Bank of Ireland US Branch Resolution Plan. Public Version. December 2013. BOI Group Classification: Green - Public

Bank of Ireland US Branch Resolution Plan. Public Version. December 2013. BOI Group Classification: Green - Public Bank of Ireland US Branch Resolution Plan Public Version December 2013 BOI Group Classification: Green - Public Table of Contents 1. Introduction... 2 2. Name of material entities... 2 3. Core operations

More information

BY G. A. OGUNLEYE, OFR MANAGING/DIRECTOR/CEO NIGERIA DEPOSIT INSURANCE CORPORATION

BY G. A. OGUNLEYE, OFR MANAGING/DIRECTOR/CEO NIGERIA DEPOSIT INSURANCE CORPORATION THE ROLE OF DEPOSIT INSURANCE IN ENSURING FINANCIAL SYSTEM STABILITY IN NIGERIA BY G. A. OGUNLEYE, OFR MANAGING/DIRECTOR/CEO NIGERIA DEPOSIT INSURANCE CORPORATION 1 PAPER OUTLINE INTRODUCTION FUNCTIONS

More information

Ch 19 Deposit Insurance Overview

Ch 19 Deposit Insurance Overview Ch 19 Deposit Insurance Overview The focus of this chapter is the mechanisms designed to protect FIs from liquidity crises. Deposit Insurance Funds Securities Investors Protection Corporation Pension Benefit

More information

Information on Capital Structure, Liquidity and Leverage Ratios as per Basel III Framework. as at March 31, 2015 PUBLIC

Information on Capital Structure, Liquidity and Leverage Ratios as per Basel III Framework. as at March 31, 2015 PUBLIC Information on Capital Structure, Liquidity and Leverage Ratios as per Basel III Framework as at Table of Contents Capital Structure Page Statement of Financial Position - Step 1 (Table 2(b)) 3 Statement

More information

International Association of Credit Portfolio Managers

International Association of Credit Portfolio Managers International Association of Credit Portfolio Managers Principles and Practices: 2015 Expanding Role of Credit Portfolio Management Survey Goal IACPM Members share their views on the state of CPM today,

More information

Zurich, 13 December 2007. Introductory remarks by Philipp Hildebrand

Zurich, 13 December 2007. Introductory remarks by Philipp Hildebrand abcdefg News conference Zurich, 13 December 2007 Introductory remarks by Philipp Hildebrand Six months ago, when our Financial Stability Report was published, I stated that "the global financial system

More information

Africa Bond Markets Conference Nairobi November 2011

Africa Bond Markets Conference Nairobi November 2011 Africa Bond Markets Conference Nairobi November 2011 Session: Housing & Securitisation How Housing Finance Organisations Can Access Bond Markets Global Perspective & Application to Africa Kerry Adby kadby@attglobal.net

More information

Should Life Insurers buy CoCo Bonds? - Regulatory Effects Implied by the Solvency II Standards

Should Life Insurers buy CoCo Bonds? - Regulatory Effects Implied by the Solvency II Standards Should Life Insurers buy CoCo Bonds? - Regulatory Effects Implied by the Solvency II Standards Helmut Gründl, Tobias Niedrig International Center for Insurance Regulation (ICIR) and Center of Excellence

More information

NEED OF FINANCIAL INSTITUTIONS SUPERVISION THROUGH AN SINGLE FRAMEWORK OF MACRO-PRUDENTIAL SUPERVISION

NEED OF FINANCIAL INSTITUTIONS SUPERVISION THROUGH AN SINGLE FRAMEWORK OF MACRO-PRUDENTIAL SUPERVISION NEED OF FINANCIAL INSTITUTIONS SUPERVISION THROUGH AN SINGLE FRAMEWORK OF MACRO-PRUDENTIAL SUPERVISION MEDAR LUCIAN-ION, Professor PHD, CHIRTOC IRINA-ELENA, Assistant professor PHD, CONSTANTIN BRANCUSI

More information

Supplement to the December 2015 Financial Stability Report: The framework of capital requirements for UK banks

Supplement to the December 2015 Financial Stability Report: The framework of capital requirements for UK banks Supplement to the December 2015 Financial Stability Report: The framework of capital requirements for UK banks 1 The framework of capital requirements for UK banks December 2015 The framework of capital

More information

Summary of GE Capital s SIFI Rescission Request

Summary of GE Capital s SIFI Rescission Request SUPPLEMENTAL DOCUMENT March 31, 2016 Summary of GE Capital s SIFI Rescission Request In 2013, GE Capital was designated as a nonbank Systemically Important Financial Institution (Nonbank SIFI) by the Financial

More information

Introduction to Australian Real Estate Debt Securities

Introduction to Australian Real Estate Debt Securities 1 Introduction Introduction to Australian Real Estate Debt Securities Superannuation fund investors and managers have for a long time invested in real estate as part of their asset allocation in the belief

More information

BOARD OF GOVERNORS FEDERAL RESERVE SYSTEM

BOARD OF GOVERNORS FEDERAL RESERVE SYSTEM BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D.C. 20551 DIVISION OF BANKING SUPERVISION AND REGULATION DIVISION OF CONSUMER AND COMMUNITY AFFAIRS SR 12-17 CA 12-14 December 17, 2012 TO

More information