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Financial regulation – who should do what?

FREE Central Banking web seminar Free Registration Date: Tuesday 7 September 2010 Time: 8:30am BST to 9:30am BST (London) Post crisis, many central banks’ financial stability mandates have been strengthened. And many now believe that, in order to better safeguard stability, central banks need a much better understanding of individual banks and the industry’s behaviour. [...]

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Highlights of the US financial reform legislation

July 2010 OVERSIGHT A 10-member council of regulators led by the Treasury secretary would monitor threats to the financial system. It would decide which companies were so big or interconnected that their failures could upend the financial system. Those companies would be subject to tougher regulation. If such a company teetered, the government could liquidate [...]

Snippets

• 07 Sep. Top executives from some of the world's leading banks are due to gather for a conference in Frankfurt later this week to try to forestall what they see as overly harsh regulation brought on by the global financial crisis. Existing rules failed to ensure that banks held enough capital and liquidity to withstand the crisis, forcing governments to bail out lenders with taxpayers' money. Regulators have been moving to put banks on a shorter leash - a set of rules, called "Basel 3" - with decisions likely to be made by November. (more...) #
• 06 Sep. An international survey of leading wholesale banks finds that significant progress has been made in improving compensation policies and practices. Overall, most major banks are now implementing compensation systems in line with the Implementation Standards published by the Financial Stability Board (FSB) in September 2009. The Institute of International Finance, in collaboration with Oliver Wyman, published its second survey-based report on compensation in the financial services industry, which consists of responses from 37 financial services firms. These have been supplemented by a series of individual interviews with leading wholesale banks. Between them, these institutions represent 70% of total global wholesale banking revenues for 2009. #
• 05 Sep. European governments gave their approval to an overhaul of the way banks and markets in the region are supervised, which was agreed in principle on Thursday night. However, they warned that new pan-European Union watchdogs would need to exercise their powers cautiously. In Germany, Leo Dautzenberg, a member of Chancellor Angela Merkel’s ruling Christian Democratic Union, and one of its finance policy experts in parliament, hailed the agreement on the EU financial supervision package as “closing an important gap in financial market regulation”. (more...) #
• 02 Sep. ECB statement: Based on its regular economic and monetary analyses, the Governing Council continues to view the current key ECB interest rates as appropriate. It therefore decided to leave the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility unchanged at 1.00%, 1.75% and 0.25% respectively. Considering all the new information and analyses which have become available since our meeting on 5 August 2010, we continue to expect price developments to remain moderate over the policy-relevant medium-term horizon, benefiting from low domestic price pressures. Recent economic data for the euro area have been stronger than expected, partly owing to temporary factors. (more...) #
• 02 Sep. Federal Reserve Bank of Dallas President Richard Fisher said Wednesday the recovery of the U.S. economy “will take quite some time,” and that improved regulatory and fiscal policies are needed in order to help the process. “We need to restore confidence,” he told reporters after giving a speech before the Greater Houston Partnership. “We are not the only one in the pilot house driving this ship, it has to be complemented…with fiscal and regulatory” policies that encourage business owners. He added that any possible new stimulus program should focus on generating jobs. (more...) #