Shadow BankingRSS

Shadow banking drives up leverage in China

Rating agencies flag up concerns over the growth in China’s shadow banking system and non-performing loans

European Council signs off money market fund rules

The Permanent Representatives Committee aims to limit shadow banks’ influence on the financial system.

Norm Champ

US investment funds resist derivatives cap

Fund managers are set to welcome the Securities and Exchange Commission plan to consolidate the rulebook, but not a cap on derivatives notional exposure.

Alexander Schindler

Basel causes confusion with step-in risk concept

The Basel Committee seems to be targeting banks’ asset-backed vehicles, but asset managers fear they will bear the brunt of any new rules.

Martin Moloney

Regulators play down bond market liquidity risks

Better buy-side liquidity management and ongoing technological changes are seen as the answer, not a roll-back of post-crisis regulation.

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.

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