By Claudio Borio, Stijn Claessens and Nikola Tarashev We propose a framework for classifying regulatory measures with a financial stability objective as activity-based (AB) or entity-based (EB). AB measures constrain an activity on a standalone basis, whereas EB measures constrain a combination of activities at the level of entities. Since such combinations underpin much of financial[…]

Key takeaways Banks’ cross-border claims rose by $1.4 trillion over the first quarter of 2022, the third largest quarterly expansion on record. Even on a seasonally adjusted basis, the expansion was unusual (+$700 billion), booked mostly vis-à-vis advanced economies (AEs). Banks’ cross-border claims on EMDEs changed little overall over Q1 2022, as a drop in claims on China offset an[…]

By the ECB/ESRB Project Team on climate risk monitoring As work on laying the analytical foundations for measuring climate-related financial risk matures, there is a need to better gauge its implications for systemic risk, and associated scope for a macroprudential policy response. Previous assessments of climate-related risks to financial stability for the European Union have[…]

By Pamela Pogliani and Philip Wooldridge Financial centres that cater predominantly to non-residents – which we refer to as cross-border financial centres (XFCs) –are important intermediaries of cross-border financial flows. For analysing capital flows and international interconnectedness, it can be useful to distinguish countries that are home to XFCs from other countries. We improve on previous methodologies for identifying[…]

By the European Systemic Risk Board (ESRB) The NBFI Monitor 2022 discusses the main developments related to investment funds and so-called other financial institutions (OFIs) in 2021 and provides an initial overview of the developments triggered by the war in Ukraine. Total assets of EU investment funds and OFIs grew by approximately 9% in 2021.[…]

By the Single Resolution Board (SRB) The Single Resolution Board (SRB) has today published its assessment of bank resolvability, for the first time. The resolvability assessment and ‘heat-map’ for 2021 shows that banks have made significant progress in the SRB’s priority areas. The assessment is based on the information available to the SRB during the drafting[…]

By Financial Stability Board (FSB) When commissioned in late 2021, this report to the G20 was intended to discuss policies in the aftermath of a past shock. Since then, the economic and financial market situation has evolved considerably and vulnerabilities that COVID-19 support measures prevented from materialising may now come to the fore. Link: Exit[…]

By the Single Resolution Board (SRB) The SRB today published its Annual Report for 2021. The report details the work of Europe’s Single Resolution Board and highlights the progress made in making Europe’s banking sector more stable, by ensuring all of the SRB’s banks are resolvable. The SRB focused on areas such as implementing the[…]

By Tobias Adrian and Jay Surti Countries have made substantial progress toward implementing capital markets regulatory reform, but important gaps remain and new challenges have raised the bar. Capital markets are like engines that help power the global economy: they perform best with regular tune-ups. In this spirit, the major regulatory overhaul following the global financial crisis was[…]

By Darrell Duffie, Thierry Foucault, Laura Veldkamp, Xavier Vives The digitalisation of financial services presents formidable tests for incumbent financial intermediaries, firms, exchanges and regulators. The fourth report in the series on The Future of Banking examines the growing impact of technology on financial markets and institutions and identifies the key challenges in payment systems, the use[…]