With the EBA and the ECB announcing results of the stress test and the AQR next week, and with feeble banks shivering, you may consider setting aside a couple of hours this week to read the terms and conditions of bank capital instruments. Maybe your investment in capital securities of EU banks is at risk, maybe not.… Read More Homework for the upcoming week: EU bank capital rules.
This week, the Bank of England offered two highly readable publications, each for a different reason. The Financial Policy Committee launched a consultation on the design of a leverage ratio framework for the UK. This is a very insightful release, even though the consultation period is a tad short: The FPC consultation will close on 14… Read More BOE, the Leverage Ratio, and Capital.
The European Central Bank (ECB) published a detailed manual providing guidelines for authorities and their third-party supporters in carrying out on-site inspection aimed at checking the quality of the biggest banks’ assets in the bloc. Click here for the manual. Or here if the first link does not work. Click here for the Comprehensive Assessment… Read More Jay! The ECB’s AQR manual is out
Both Basel and EBA published the mid-year 2013 Basel III monitoring results. The monitoring rounds show how banks are converging toward the Basel III end-state. EBA’s main findings show that the Common Equity Tier 1 capital ratio (CET1) of the largest internationally-active European banks (Group 1 banks) would be on average 9.1% compared to a ratio of 12%… Read More EBA and BCBS publish Basel III monitoring results
Without comments from my side yet: see here ECB’s note on the comprehensive assessment.
Among the many publications that the EBA posted on its website last week, the Technical advice to the Commission (EC) on the treatment of unrealized gains deserves attention. Not only because of its content, but also because of the clarity, depth, and breadth of covering the issue of unrealized gains. Here is the context: EBA’s advice… Read More EBA advises Europe to overturn Basel III rule on unrealized gains
RBS N.V. features on the list of designated banks for the Comprehensive Assessment (CA). See the ECB CA document here. Though the name suggests Scottish origins, RBS N.V. is incorporated in the Netherlands; thus subject to direct Dutch supervision (and indirectly subjected to UK supervision via the Bank of England, which supervises RBS Group, the… Read More On the Comprehensive Assement List: RBS N.V.
Just a quicky – from EBA: it publishes today its fourth report of the Basel III monitoring exercise on the European banking system. Click here for the full report. “The exercise monitors the impact of the implementation of the Basel III requirements in the EU, based on the assumption of a full implementation of the… Read More EBA publishes results of the Basel III monitoring exercise as of end 2012
I updated this post, as discussions on the leverage ratio still suffer from a poor understanding of this solvency measure. See my post on this odd proposal by three Dutch professors, who basically want to turn back time to the Basel II (not III) era, and allow banks to borrow money to increase their capital… Read More Leverage Ratio Eye-openers, updated