Increased capital requirements threaten to restrict banks’ ability to fund trade finance deals and further constrain economic growth. Distribution of trade finance assets to investors is emerging as a practical solution to a looming crisis.
Capital
New threats to financial stability rapidly emerging
The Covid-19 pandemic is barely winding down and already prominent global bodies are sounding warnings over new dangers to financial stability, this time relating to soaring inflation, rising interest rates, emerging market vulnerabilities and the war in Ukraine.
EBA ponders building environmental risks into prudential framework
The European Banking Authority (EBA) is asking whether environment risks should be embedded into the EU’s Pillar 1 prudential framework, which deals with minimum capital requirements.
PRA warns banks over pension deficit reduction schemes that hit regulatory capital
Banks have been told not to engage in deficit reduction transactions with their defined benefit pension schemes designed to limit the regulatory capital impact and at least one large UK bank is implicated in the warning.
Stablecoins should come under bespoke prudential rules - OCC
Stablecoins should come under prudential rules given the potential stability risks they pose, said acting comptroller of the currency Michael Hsu, adding that more attention should be given to interoperability.
Russia faces banking crisis as sanctions bite
Following some of the harshest sanctions ever imposed on a country, Russia could face a banking crisis within a year as its economy braces for the worst contraction in nearly three decades.
Five Western banks face direct losses from Russia-Ukraine conflict
Five Western banks have significant operations in Russia, and though they face losses as that country’s economy wilts under a barrage of international sanctions, the damage to the parent companies should be relatively limited, according to rating agencies.
APRA prudential plans largely on track Byres tells parliament
The long term prudential plans of the Australian Prudential Regulation Authority (APRA) have not been severely disrupted by the economic impact of the Covid-19 pandemic, its chair told a parliamentary committee.
Industry welcomes EBA final draft on ESG Pillar 3 disclosures
The final draft implementing technical standards (ITS) on Pillar 3 disclosures on environmental, social and governance (ESG) risks was published by the European Banking Authority (EBA) on January 24 and was welcomed by banks.
Switzerland reactivates CCyB fearing crash could leave some lenders undercapitalised
Switzerland is reactivating the bank countercyclical capital (CCyB) buffer to 2.5% for real estate loan exposures fearing a market crash could leave some lenders needing to be recapitalised.
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