Internationally Active Banks Are Meeting Initial Basel III Standards

Forbes

More than two hundred banks around the globe, including one hundred and eleven, large internationally active banks, are making progress in meeting initial minimum Basel III standards. The bank international standards setter, Basel Committee on Banking Supervision, published its Basel III Monitoring Report today as part of its semiannual process to monitor the dynamics and effects on banks of the Basel III capital, liquidity, and leverage reforms. The Basel Committee utilizes data collected by bank supervisors in the 27-member countries to determine the international regulatory banking framework Basel III’s impact on banks.  Read more.

Are Banks Well-Prepared For Operational Risks Posed By Brexit?

Forbes

The deadline for Great Britain to complete its Brexit negotiations is six months from today.  Unfortunately, I have seen little evidence that internationally active banks in Britain or elsewhere are prepared for the operational risks to which banks are exposed, especially as uncertainty rises about when Brexit negotiations will be completed and how.  Read more

New York Bond Buyers Must Increase Due Diligence Before It’s Too Late

The Bond Buyer

Anyone intending to buy or already holding New York bonds needs to increase due diligence of those issuers’ risks. The recent Internal Revenue Service’s decision to deny the State and Local Tax (SALT) cap work around proposed by elected officials for high property tax municipalities in New York is viewed negatively by Moody’s credit rating agency. Read more

Forty U.S. States Cannot Afford To Pay All Their Bills

Forbes

Forty states do not have enough money to pay all of their bills, according to quantitative analysis in Financial State of the States, the ninth annual report published this evening by Truth in Accounting (TIA). TIA is a non-partisan, not-for-profit government finances watchdog. To balance the budget, “elected officials have not included the true costs of the government in their budget calculations and have pushed costs onto future taxpayers.” Read more

Financial Institutions Face Turbulent Journey Ahead

Forbes
September 23, 2018

The Bank for International (BIS) Settlements Quarterly released today contains important quantitative and qualitative information pointing to a turbulent journey ahead, not only for banks but also for a diverse range of financial institutions and investors globally.  In the near future, the two areas that all should monitor more closely are the continued rise in corporate debt issuance globally, especially those issues that are covenant-lite or in U.S. dollars by emerging market debt issuers, and the intensifying impact of Federal Reserve interest rate rises on all corporate borrowers, but especially those in emerging markets. Read more

Many More States Are Vulnerable To Trump’s Tariffs

Forbes
September 20, 2018

Much press about the states that could be hurt by Trump’s tariffs has focused on the number of targeted exports in each state.  As a bank and capital markets consultant and trainer, a big part of what I do is to analyze what could adversely impact banks in order to determine the level of capital, liquidity, and risk management they need so that they do not end up requiring tax payer bailouts.  After analyzing a number of data series, I believe that many more states than are usually cited are vulnerable to Trump’s tariffs. Read more

Trump’s Tariffs Will Hurt American Consumers, Workers And U.S. Banks

Forbes
September 17, 2018

China-US trade tensions have escalated significantly, since I wrote this summer that US banks needed to brace for Trump’s tariffs.  It is imperative that US bank regulators and bank risk managers calculate not only US banks’ direct credit and market exposure to Chinese companies, banks, and Chinese borrowers, but also to the numerous American companies and consumers who will be adversely impacted by this escalating trade conflict.  Read more

 

Much More Remains To Be Done With European Bank Reforms

Forbes
September 11, 2018

A decade after Lehman Brothers declared bankruptcy, many problems of the European financial system remain unresolved. Reforming banks and other financial institutions in Europe is pressing especially in light of current economic challenges in Turkey and Italy. Read more

Basel Committee’s William Coen Is Instrumental To Global Banking Reform

Forbes
September 3, 2018

For the last decade, many of us– consultants, journalists, legislators, and regulators– have spent countless hours identifying the causes of the 2008 financial crisis and those who were responsible. Yet, what about all the people who have been toiling away to improve the banking sector since even before the financial crisis? I can only think of one person who has been intimately involved non-stop on crafting guidelines and principles to increase the safety and soundness of the banking system globally for over a decade, William Coen. He joined the Basel Committee for Banking Supervision, the international standards setter for banks in 2007, when few of us could have ever suspected the global implications of the U.S. financial crisis. Read more.

Why Do Republicans Want To Gut Bank Regulations Even More?

Forbes
August 22, 2018

Not satisfied with the regulatory relief that legislators bestowed upon banks under the Economic Growth, Regulatory Relief and Consumer Protection Act(S. 2155) signed earlier this year, seven Republican senators want to gut bank regulations even more. They wrote the Federal Reserve’s Vice Chairman for Supervision, Randall Quarles, last Friday requesting the relaxation of key capital and liquidity rules for numerous banks. Read more

Latin American And Asian Banks Are Promising For Long-Term Investors

Forbes
August 16, 2018

Investors this year have been very bearish about emerging market currencies and other assets. Just on Wednesday, the widely followed Morgan Stanley Composite Index (MSCIEF) that tracks 24 emerging markets declined 20% from January 2018. Political uncertainty and corruption scandals in many emerging markets, along with rising interest rates in the United States, a strong dollar, and tariff threats from the Trump Administration, have been key reasons for the decline in asset prices in emerging. Compounding concerns about emerging markets in the last couple of weeks has been the Turkish crisis. Many investors have questioned whether the Turkish crisis would lead to full blown crisis or at least significant contagion to other emerging markets. Fortunately, for the moment, Turkey received a $15 billion life line from its ally Qatar on Wednesday. No doubt, concerns about Turkey’s high level of dollar denominated debt will continue to weigh on emerging markets…Read More

Getting the Volcker Rule Right May Be A Waste of Time

American Banker
August 15, 2018

There are significant shortcomings in the resources allocated to financial regulators for them to adequately monitor and enforce the Volcker Rule, and banks have inadequate systems and risk data aggregation to produce reliable metrics in order to comply. Read more

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