IFLR's coverage of regulatory changes to US, UK and EU bank structures features in-depth analysis and expert opinion on the reforms' legal and systemic implications
LIIKANEN REPORT
Global concerns
Why Kay, Volcker are wrong about ringfencing It is possible to effectively ringfence retail and investment activities without restructuring banks into essentially two separate entities
How Liikanen will change global banking The Bank of Finland governor this month announced his flagship report for reshaping European banks. Here’s how these proposals could change global trading
Liikanen Report: market concerns UK lawyers have branded the Liikanen Committee’s recommendations for European banking sector reform as counterproductive
European bank reform: the Liikanen Report revealed The Liikanen Committee has revealed its recommendations for how Europe's banking structure should reform
A tale of three cities Welcome to the new world order. Again. Of course, it's all too easy to be cynical. Seismic shifts in the investment-banking model have been prophesised time and again since the events of 2008, and beyond, changed the worldview of banking behemoths irrevocably
European concerns
Liikanen says EU bank overhaul could increase shadow banking The proposed European bank reforms could increase shadow-banking activity, Erkki Liikanen, chairman of the European Union High Level Experts Group has warned
Liikanen poll: 75% say Volcker/Vickers hybrid wrong for Europe's banks Ahead of a Liikanen review consensus, IFLR questioned market participants as to whether a combined Volcker/Vickers approach was right for Europe’s biggest banks
UK concerns
FSA prudential chief: why banks must be ringfenced The managing director of prudential regulation at the Financial Services Authority, Andrew Bailey, has publically backed the need for powers to separate trading activities into separate legal entities
How Liikanen will impact Vickers implementation European banking reforms, as proposed by the Liikanen Commission, are likely to supersede or replace the UK’s Vickers, lawyers have predicted
US concerns
Could US-style Liikanen reform work? Following US Republican Presidential nominee Mitt Romney’s pledge to repeal the Dodd-Frank Act, speculation has grown as to whether US-style Liikanen reforms could feasibly replace Volcker
SHADOW BANKING
Global concerns
Shadow banking: are the shadows really banks? - opinion Shearman & Sterling's Financial Institutions Advisory and Financial Regulatory group head, Barnabas Reynolds, outlines why the entire regulatory effort to tackle shadow banking could be one step too far
FSB reveals shadow banking policy options The chair of the securities lending and repo workstream of the Financial Stability Board’s (FSB’s) shadow banking taskforce has laid out the policy options his team is reviewing, giving a real indication of what form the proposals will take
European concerns
Liikanen outlines consequences of EU's bank overhaul The proposed European bank reforms could increase shadow-banking activity, Erkki Liikanen, chairman of the European Union High Level Experts Group has warned
Shadow banking rules: AMF MD reveals regulatory agenda Edouard Vieillefond, the managing director in charge of the regulatory policy and international affairs division of the AMF, reveals how he thinks shadow banking should be regulated
ECB: how to create a central EU repo database Vitor Constâncio, vice-president of the ECB, proposed the creation of a central database to provide information on the European repo market at the EC's shadow banking conference in April
Unicredit: why mandatory haircuts won’t work Mandatory haircuts will diminish the liquidity of the market and increase banks need for unsecured funding, according to Edouard Cia, Unicredit’s managing director, head of short term interest rate desk
US concerns
US shadow banking: the key concerns outlined The colossal fallout of Knight Captial's software error renewed concerns that the shadow-banking sector threatens the stability of the US financial system
Asia concerns
Lawyers urge CBRC to not curtail shadow banking China’s lawyers have called for the country’s regulators to liberalise its shadow banking system
EUROPEAN BANKING UNION
European concerns
EU split over banking union decentralisation German support for an EU banking union has increased after last week’s comments by European Commissioner Michel Barnier clarified that national regulators will continue to have a role
How to split up the euro 2013 will be crunch time for the Eurozone, lawyers have warned
UK concerns
EXPERT OPINION: why an EU banking union poses an existential threat to the UK Mark Field is MP for the Cities of London & Westminster believes a successful banking and fiscal union represents an almighty challenge to the UK
LONDON INTERBANK OFFERED RATE
Global concerns
How banks could have Libor cases dismissed Class action law suits filed in US courts claim international banks colluded at the expense of investors, community banks, municipalities and investment funds. But banks are not without ammunition of their own
Barclays rate fixing scandal: Libor alternatives analysed Barclays' rate-fixing scandal has highlighted the widespread inefficiencies within the Libor setting process. IFLR asked readers should Libor be scrapped? Here’s what they had to say
Wheatley's Libor Review: what will it achieve? Questions as to whether criminal sanctions for manipulating Libor will have retrospective effect have dominated the market reaction to this morning’s release of the Wheatley Libor Review’s final report
How to fix Libor US and UK market participants outline how Libor and equivalent indices must be reformed to restore confidence in the system
EXPERT OPINION: Wheatley's Libor review is a hybrid failure University of New South Wales’ professor Justin O’Brien believes the oversights within the Wheatley Review are startling
Asia concerns
Wheatley correct to scrap A$ Libor Phasing out Australian dollar rates from the London Interbank Offered Rate is the right decision, according to local lawyers
Tibor and Sibor reforms set to follow UK Lawyers in Tokyo and Singapore expect the Tokyo interbank offered rate and Singapore interbank offered rate amendments to follow those made in the UK and US
Afma: what Libor can learn from Australia’s benchmark Principles underpinning Australia’s benchmark interest rate could be extended to Libor to improve its transparency, integrity and avoid scope for manipulation
UK concerns
What TSC Libor report means for London’s reputation The Treasury Select Committee’s preliminary report on fixing Libor called for reform in several areas of the UK banking sector. Here’s why market participants consider it a defining moment for financial regulation
Deferred prosecution agreements possible for Libor changes UK white collar prosecutors look set to receive a new enforcement tool following the Ministry of Justice’s consultation on DPAs, which closes on Thursday
Morgan Stanley: BoE must replace BBA on Libor Morgan Stanley has called for the Bank of England to replace the British Bankers’ Association in running Libor settings. But a less transparent rate-setting methodology is required for the move to be effective
Libor probe proves banks too big for the UK The investigation into Libor has confirmed international financial institutions have become too big for the UK, investment bank general counsel have warned. But splitting commercial banks from investment banks is the wrong solution
BASEL III
Global concerns
EXPERT OPINION: The year is 2010. Basel 6 – how did we get here? The International Centre for Financial Regulation's chief economist has predicted Basel III will look very different in just a few years time
Global regulators to copy UK’s relaxed capital rules Other countries are tipped to follow the UK Financial Services Authority’s lead and soften bank capital requirements ahead of Basel III implementation
Asia concerns
Why Basel III could jumpstart Asia’s high-yield market As bank lending becomes less accessible, the region's high-yield market could thrive. But Asian investors must first become more open to investing in low-rated notes
Why Basel III will limit Chinese bank financing Chinese banks’ concerns are growing as counsel outline how the China Banking Regulatory Commission’s implementation of Basel III will limit their financing
How Australia hybrid first clarifies Basel III implementation The first Basel III-compliant Tier 1 hybrid bond to be issued by an Australian bank acts as a regulatory test case on Basel III implementation in the country
Why Basel III is bad for China Implementation of Basel III in China would result in a vicious downward cycle. It should be postponed until developed countries have reached an agreement on the requirements, market participants have said
European Union concerns
New trading book rules target value-at-risk The Basel Committee on Banking Supervision’s latest consultation on trading book capital rules signals a move away from the discredited value-at-risk model
REGULATOR INTERVIEW: France’s AMF reveals lessons learnt post-crisis The French regulator discusses the huge changes in financing economy, what he has learnt from the eurozone crisis, and whether his worries about the unintended consequences of regulation
LMA speaks out on CRD IV Europe’s Capital Requirements Directive 4 will harm the syndicated loan market and impair a vital source of liquidity for borrowers, according to the Loan Market Association
Cocos: where the EBA went wrong In the days before the January 20 deadline for banks to present their plans to raise the €114.7 billion needed to recapitalise, strict limits the EBA imposed on cocos prompted concern over who would buy the securities
IBA speakers criticise Basel III capital requirements Basel III plans to raise banks’ capital requirements were slammed at an IBA session as both short-sighted and ineffectual UK concerns
How national implementation will create CRD IV uncertainty Requirements that capital conservation and counter cyclicality buffers be implemented by national laws will create additional uncertainty for banks already facing a huge workload to implement Basel III and CRD 4 on time
US concerns
US prudential standards to exceed Basel III Today the Federal Reserve announced its long-awaited proposal for prudential regulation of systemically important financial institutions
The winners and losers under US Basel III The Federal Reserve's June 12 proposal of rules implementing Basel III create a dubious future for US banks regarding Tier 1 contingent convertible capital (Cocos), a battle on risk weightings, and capital raising problems for small banks
Fed’s Basel III: global harmonisation wins approval The Federal Reserve's proposed rules implementing Basel III represent the biggest post-crisis step towards a harmonised global capital framework. US lawyers have welcomed the move
US stress tests show Basel III readiness The positive results of the US Federal Reserve’s stress tests are understood by legal experts to suggest US preparedness for the implementation of Basel III capital requirements
For more analysis of the latest developments in financial regulation see Euromoney's financial regulation special focus