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Contagion risks growing in US Treasuries market due to fragmentation of clearing

There is a growing contagion risk due to the fragmentation of the US Treasuries market, argues the the Depository Trust & Clearing Corporation (DTCC), a market infrastructure firm, in a white paper published on May 25 called ‘More Clearing, Less Risk: Increasing Centrally Cleared Activity in the US Treasury Cash Market’.

Fed says CBDC could complement cash and will publish discussion paper during the summer

A US central bank digital currency (CBDC) could complement rather than replace cash and digital equivalents of the US dollar with its design raising important questions around monetary policy, financial stability, consumer protection, legal, and privacy considerations, said Jerome Powell, chair of the US Federal Reserve Board. 

SEC brings legal action against Bitconnect promoters

Legal actions have been filed by the US Securities and Exchange Commission (SEC) against five individuals who it is accusing of promoting to retail investors $2bn of unregistered global crypto lending securities.

DeFi raises fresh challenges for US investors and regulators says SEC chair

Cryptocurrencies throw up various risks and challenges for investors and regulators, said Gary Gensler, chair of the US Securities and Exchange Commission (SEC) on May 26 in prepared testimony to the House Appropriations Committee.

SEC registers first security-based swap data repository

May 7 saw the registration by the US Securities and Exchange Commission (SEC) of its first security-based swap data repository (SDR), which will give the agency broader oversight of the swaps market. 

FDIC wants to know how banks are using novel technologies

Insured depository institutions are being encouraged to submit comments by July 16 on their use of digital assets and novel technologies to the Federal Deposit Insurance Corporation (FDIC).

Climate change could influence bank capital levels warns OCC

US banks face the prospect of eventually having to live with capital rules, which reflect climate change risks, said the acting comptroller of the currency Michael Hsu. 

Stress capital buffer proved effective during Covid-19 crisis

One of the key lessons of the Covid-19 crisis was that the US’s forward-looking capital framework, which includes the stress capital buffer, works very effectively, said Randal Quarles, vice chair for supervision at the US Federal Reserve Board. 

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US inter-agency co-operation deepens to provide fintech guidance to banks

US supervisors at federal and state level are looking to work closer together to provide greater clarity to the banking community on fintech issues and the adoption of new innovative technologies. 

Private equity firms helped stabilise financial system during last crisis

Research has shown that private equity (PE) investors not only helped failing banks recover well by buying into them after the 2007–2009 global financial crisis (GFC), but also contributed to financial stability, according to a paper published by the Federal Deposit Insurance Corporation (FDIC) on April 22.