WASHINGTON – The US federal government has got to become a partner with state regulators in supervising the nation’s insurance industry, a senior Congressman urged in March. Democrat Barney Frank spoke as US lawmakers vented their anger at the stalling, in an election year, of bond sales by America’s municipalities because of the bond insurance crisis.

PARIS – A new risk-adjusted measure of bank capital is soon to be unveiled by rating agency Standard & Poor’s (S&P) in order to allow consistent comparison as banks implement the new Basel II capital framework. Called the Basel II adjusted ratio (BAR), the new measure is to be published in detail for public comment in the next two months

WASHINGTON – Strong public backing for an updating of international rules governing bank liquidity management has come from Christopher Cox, chairman of the Securities and Exchange Commission (SEC), the US securities markets watchdog. In a March 20 letter to Nout Wellink, chairman of the Basel Committee, Cox says the demise of Bear Stearns, the American investment bank, a few days earlier, had been caused by the disappearance of liquidity, not a lack of capital.

WASHINGTON – As regulators acknowledged the timetable for America’s biggest commercial banks to adopt the Basel II capital rules is slipping, the country’s lawmakers put the spotlight on the regulation of investment banks following the mid-March collapse of Bear Stearns.

BRUSSELS – A group of European academics is urging the “complete recognition of losses” by global banks as the key to resolving the prolonged international financial crisis stemming from the wholesale downgrading of US sub-prime mortgage-backed assets. In a statement issued in early March, the European Shadow Financial Regulatory Committee (ESFRC), chiefly comprising professors of finance, says that the outcome of such radical recognition and disclosure of losses would “actually be benign, since it would open up avenues for keeping these losses within limits.”

LONDON – One of Britain’s top regulators has made it clear that despite the global financial market crisis and the collapse of the Northern Rock mortgage bank in September, the Financial Services Authority (FSA) intends to push ahead with its plans for a more principles-based and outcomes-based regulatory regime. Hector Sants, FSA chief executive, told a London conference in late February that this objective had not changed.

LONDON – With the IMF warning governments they may have to use taxpayer money to shore up the financial system as the credit crisis deepens, leading bankers are acknowledging the need for guidelines on pay and bonuses in the financial sector, if only as a sop to fast-growing political hostility to the industry.

WASHINGTON – A “reasonable set of options” may need to be considered by the International Monetary Fund (IMF) to safeguard the stability of financial systems if further risks materialise from the present global financial turmoil, IMF first deputy managing director John Lipsky said in mid-March.

Asia has so far got off lightly amid the subprime turmoil...and the Basel II capital rules are being succesfully adopted, too

Investments in US subprime-backed RMBS (residential mortgage backed securities) and other structured products are causing losses for some banks in Asia, including some in China. Only a few, mostly smaller banks have had to seek capital injections as a result. Notes of some individual countries follow: