European banks favour some degree of convergence in supervisory practices, but the challenges for the European Banking Authority should not be underestimated.
No US bank failed the 2015 stress tests for lack of capital, but the potential future inclusion of capital buffers and closer alignment with liquidity measures could prove challenging for the industry. The Fed is also under pressure to shake up its methodology and make the tests less predictable.
Procedural changes have done little to assuage political divide on whether insurers should be designated as systemically important financial institutions.
Already under pressure over allegations of benchmark rigging, foreign exchange traders are now facing fresh scrutiny over the practice of ‘last look’.
The European Securities and Markets Authority may acknowledge the need for a rethink in light of consultation paper responses.
The European Parliament has agreed a compromise on money market funds, but member states remain deeply divided.