December 2021 – SUERF Policy Note “Crises as a catalyst for change – lessons from the past, challenges for the future”

By Jens Weidmann Ten years ago, almost to the day, I gave my first speech at the EBC. Back then, we were dealing with the aftermath of the global financial crisis, and the sovereign debt crisis was shaking the euro area to its very foundations. To prevent the situation from coming to a head, policymakers[…]

December 2021 – SUERF Policy Brief “How to set Cyclical and Structural capital buffers via Stress tests? A Risk-to-Buffer approach”

By Cyril Couaillier, Valerio Scalone This paper proposes a framework to jointly calibrate structural (constant) and cyclical (time varying) bank regulatory capital buffers. Its transparency helps to overcome the risk of omitting or double counting systemic risks when setting capital requirements. This approach consists in producing adverse macroeconomic scenarios whose severity is amplified under high cyclical[…]

November 2021: VoxEU Column – The global footprint of Chinese banks

By Cathérine Casanova, Eugenio Cerutti, Swapan-Kumar Pradhan The global footprint of Chinese banks is substantial and growing, including during the COVID-19 pandemic. While they are similar to other banks from emerging countries in terms of their ownership and asset structure, their global footprint often resembles that of banks from advanced countries. Geographical distance acts as[…]

December 2021: VoxEU Column – Benefits of macroprudential policy in low interest rate environments

By Alejandro Van der Ghote Short-term interest rates, particularly the natural rate, have been in steady decline in the euro area and the US. This column argues that in economies with low natural rates, such as the euro area today, macroprudential policy can have benefits for the effectiveness of conventional monetary policy, in addition to[…]

December 2021: BIS Quarterly Review – The rise of private markets

By Sirio Aramonte and Fernando Avalos The last two decades have seen the growth and consolidation of private markets. These revolve around funds gathered from institutional investors by “alternative asset managers”, typically private equity or venture capital firms that have subsequently expanded into credit. In an environment of light regulation, long investor horizons and low interest rates, the involvement[…]

Novermber 2021: New ECB Financial Stability Review

By the European Central Bank (ECB) The Financial Stability Review provides an overview of potential risks to financial stability in the euro area. It aims to promote awareness in the financial industry and among the public of euro area financial stability issues. It is published twice a year. Link: Financial Stability Review

October 2021 – Banking Package 2021: new EU rules to strengthen banks’ resilience and better prepare for the future

The European Commission has today adopted a review of EU banking rules (the Capital Requirements Regulation and the Capital Requirements Directive). These new rules will ensure that EU banks become more resilient to potential future economic shocks, while contributing to Europe’s recovery from the COVID-19 pandemic and the transition to climate neutrality. Today’s package finalises[…]

October 2021 – SUERF Policy Brief “Is window dressing by banks systemically important?”

By Luis Garcia, Ulf Lewrick and Taja Sečnik Global systemically important banks (G–SIBs) are key nodes in the financial system. The identification of G–SIBs and the attendant calibration of capital surcharges to bolster their resilience is thus a supervisory priority. However, the G–SIB assessment largely relies on year–end snapshots of the banks’ balance sheets, providing[…]

VoxEU Column: Lower for longer – macroprudential policy issues arising from the low interest rate environment

By John Fell, Tuomas Peltonen, and Richard Portes At the end of 2019 the European Systemic Risk Board General Board mandated a Task Force on Low Interest Rates to revisit the ESRB’s 2016 report on “Macroprudential policy issues arising from low interest rates and structural changes in the EU financial system”, assess subsequent developments, compare[…]