Proposed asset quality review could uncover large losses. But warnings of insufficient ‘backstops’ to deal with zombie banks

Second go at regulating money market funds faces fierce opposition. Critics say proposal would end 40 years of relative stability

After the damaging Libor rigging scandal, regulators agree the response must be international. EU sets out its approach By David Keefe

BASEL – Regulators’ efforts to ensure consistency in the implementation of new rules and standards are “having a real and positive impact,” according to Wayne Byres, secretary General of the Basel Committee. The importance of ensuring that global agreements are faithfully implemented in national regulation is fully understood by standard setters. That’s why leaders of the Group of 20 strongest economies have regularly endorsed the “full, timely and consistent implementation” of the Basel III capital and liquidity standards for banks.

LONDON – Even though implementation of the Basel III capital and liquidity framework for banks is not due to be completed until the start of 2019, it is already possible to see the emergence of a Basel IV, according to professional services firm KPMG. In a mid-September report*, the firm identifies three issues that it thinks could provide the basis of the next regulatory package from the Basel Committee regulators that set prudential standards for banks around the world.

BASEL – European Central Bank executive board member Benoit Cœuré is the new chairman of the Committee on Payment and Settlements (CPSS), the central bank forum that promotes sound payment, clearing and settlement systems.

WASHINGTON – Timothy Massad, the US Treasury official who leads America’s bank bailout programme, is stepping down from his job and is reportedly being vetted to become the next head of the Commodity Futures Trading Commission (CFTC), Reuters news agency reported as GRR went to press.

MADRID/LONDON – International securities regulators and international accounting standard setters have agreed a set of protocols to deepen their cooperation in pursuing the highest standards of financial reporting globally.

PARIS – Despite the progress made in reforming the vast global over-the-counter (OTC) derivatives market, at least one US regulator is concerned about remaining vulnerabilities. William Dudley, president of the New York Federal Reserve Bank revealed his worries about the pace and sustainability of reforms at a derivatives conference in Paris in mid-September.

BRUSSELS – Europe’s recovery and resolution plans for banks that get into trouble are not adequate when such banks are big, complex and highly connected with the rest of the financial system. Other reforms are also needed, including the separation of banks’ commercial and investment activities and increased loss-absorbing capacity, both equity and bail-in debt. That’s the conclusion of a new report* from Finance Watch, a public interest association, published in September.