Shadow BankingRSS
Soraya Belghazi

ESMA provides partial relief for EU repo markets

A redrafted technical standard on settlement discipline has addressed most concerns, but will still pose a major challenge to securities financing markets in Europe.

Georges Duponcheele

Harmonisation is key obstacle to EU securitisation revival

The European Council has addressed some of the shortfalls in a plan for lower capital charges on qualifying deals, but originators could face a compliance overload.

Fund manager alarm at planned liquidity rules

Fund managers generally support the idea of swing pricing provided practical challenges can be overcome, but proposed liquidity classification rules have drawn comprehensive condemnation as misleading and unworkable.

Eric Litvack

Capital markets union faces mixed reception in EU parliament

The European Commission and Council are keen to jump-start an initiative on securitisation, but there are sceptics in the Parliament.

SEC caps mutual funds' use of derivatives

Funds will potentially face an absolute limit on notional derivatives exposure and will need to set up a formal derivative risk management programme including segregated assets to pay margin calls.

Regulators fret over shadow banking exposures

The Basel Committee is examining the risk of banks rescuing associated shadow banking entities, while the EU is pondering prudential requirements for investment firms that engage in bank-like activities.

Volcker Rule acquitted on liquidity decline

The US Office of Financial Research believes the evidence does not support claims that the Volcker Rule caused declines in banks' bond inventories, but the leverage ratio may have driven a reduction in the use of government bonds as repo collateral.

Jon Cunliffe

Exchange-traded funds join liquidity watchlist

Regulators on both sides of the Atlantic are raising concerns about the systemic risks of open-ended and exchange-traded funds holding illiquid assets.

Godfried de Vidts

Fresh warning on EU repo markets

The leverage ratio and net stable funding ratio could make securities financing activities unprofitable for broker-dealers, threatening the availability of derivative collateral and the business model of hedge funds that rely on leverage.

FSB urges better repo reporting

The Financial Stability Board wants national authorities to report securities financing transactions at least monthly, with the means to disaggregate global consolidated trade data.

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