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Jan 6, 2013

BBBC News (December 6, 2013).: Banks win more flexible liquidity rules from Basel

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Banks win more flexible liquidity rules from Basel

Bank headquarters in Canary Wharf, London International banks had been fearing tougher liquidity rules
International financial regulators have eased rules on minimum quantities of cash and liquid assets all banks must hold, set to take effect in 2015.
The agreement, by the body that oversees the Basel Committee on Banking Supervision, is an attempt to make banks less vulnerable to runs.
The new "liquidity coverage ratio" will be phased in from 2015 and take full effect four years later.
Analysts say the rules just announced are more flexible than a draft version.
The new rules are part of efforts to prevent financial shocks such as those prompted by the 2007 run on Northern Rock in the UK, or by the 2008 collapse of Lehman Brothers in the US.
Banks will have to hold enough cash and easily sellable assets, to tide them over during an acute 30-day crisis.
The final version of the rules updates a draft version put forward more than two years ago.
Perhaps the most striking characteristics of today's agreement - which amends a draft first published in 2010 - is that banks will be allowed to include corporate bonds, some shares and high-quality residential mortgage backed securities in their permitted stocks of liquid assets.
This goes against the grain of central banking and regulatory orthodoxy. In particular, the inclusion of mortgage-backed securities will be seen by some as odd, since these proved to be wholly illiquid and unsellable in the summer of 2007.
Analysts had warned that over-stringent standards could reduce lending and stifle economic growth.
The new version allows banks to hold a broader range of eligible assets, including some shares, corporate bonds, and high-quality residential mortgage backed securities.
It also gives them more time to comply with the new standards.
The head of oversight body's head, Mervyn King, said the timeframe ensures the rules "will in no way hinder the ability of the global banking system to finance the recovery".
BBC business editor Robert Peston says the oddity is that most banks currently hold considerably more than the new minimum requirement - because leading central banks have injected massive amounts of liquidity into the financial system through "quantitative easing".
But this simply reflects the depressed times we live in, our correspondents says.
The new rules would force banks to hold vastly more liquid assets than they did in 2007 when big banks barely had enough cash to meet demands for repayment from relatively small numbers of depositors and creditors, our correspondent adds.
They are part of the broader "Basel III" package of reforms, which will require lenders to set aside more capital to absorb losses.
The Basel Committee brings together representatives regulators from 27 nations.

Market Outlook for this Week and 2013 | Trade With Precision (TWP) (January 6, 2013).

from Trade With Precision - www.tradewithprecision.com


Nick McDonald discusses what he expects to happen on stock and currency markets for the week ahead in the first market commentary for 2013.

View this week's market outlook videos

 

NYT Global Update (January 6, 2013).: Defiant Assad Says Syria 'Accepts Advice but Not Orders'

The New York Times International Herald Tribune
January 6, 2013
Compiled 21:45 GMT

Global Update

TOP NEWS

Defiant Assad Says Syria 'Accepts Advice but Not Orders'

By ANNE BARNARD
President Bashar al-Assad ruled out talks with the armed opposition and ignored its demand that he step down, instead using a nearly hourlong speech to justify his crackdown.

As Putin's Grip Gets Tighter, a Time of Protest Fades in Russia

By ELLEN BARRY
The excitement around last year's street activism against Vladimir V. Putin, now president again, is gone. But steps by the government are still setting off waves of indignation.

Top Regulators Give Banks a Bit of Breathing Room

By JACK EWING
Banks around the world will have more leeway in meeting new rules designed to prevent future financial crises, after a decision Sunday by a group of top central bankers and regulators meeting in Switzerland.
Opinion

Op-Ed Columnist

Looking for a Jump-Start in China

By NICHOLAS D. KRISTOF
China's next top leader has the potential to be a game changer, and to nourish China's rise with sweeping economic and political reforms.
Travel

Slide Show: Philadelphia, Past and Present

Centuries of history mingle with recent openings in this tour of Philadelphia.
WORLD

As Biofuel Demand Grows, So Do Guatemala's Hunger Pangs

By ELISABETH ROSENTHAL
Biofuel expansion has contributed to spikes in food prices and a shortage of farmland; both are felt keenly in Guatemala, with its corn-based diet and land owned by a handful of families.
BUSINESS

Health Insurers Raise Some Rates by Double Digits

By REED ABELSON
Even though regulators are required by the new health care law to review requests for a large rate increases, many states have not given the overseers any authority to deny or roll back rates that are deemed excessive.

The Crowdfunding Crowd Is Anxious

By AMY CORTESE
For new businesses, the regulatory path to crowdfunding - Internet-based financing that involves ordinary investors - is still far from clear.
Slipstream

Their Apps Track You. Will Congress Track Them?

By NATASHA SINGER
A Senate bill would require phone users' consent for location recording, which would give people more control over their digital footprints.
TECHNOLOGY
Novelties

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By ANNE EISENBERG
A Canadian company plans to build a pilot plant to determine whether removing carbon dioxide directly from the atmosphere can be cost-effective.

Michael Cronan, Who Gave TiVo and Kindle Their Names, Dies at 61

By RICHARD GOLDSTEIN
Mr. Cronan, a San Francisco-based graphic designer and marketing executive, placed his stamp on popular culture with the pair of brand names he came up with a decade apart.
SPORTS

N.H.L. and Players Union Reach Tentative Agreement to End Lockout

By JEFF Z. KLEIN
The agreement was reached around 5 a.m. at a Midtown Manhattan hotel after a 16-hour negotiating session. Pending ratification by the players and owners, a 48- to 50-game schedule is expected to begin before Jan. 20.

For Many, a Tournament of Big Dreams

By ROB HUGHES
Many countries just use their cups as secondary revenue streams for clubs, but England has used its tournament to produce 141 years of magical memories.

Germans Win 5th Straight Luge Victory

By THE ASSOCIATED PRESS
Tobias Wendl and Tobias Arlt won their fifth consecutive luge World Cup event to maintain their perfect start to the season.
U.S. NEWS

Gunman and Three Others Killed After Standoff in Aurora, Colo.

By RAVI SOMAIYA
After unsuccessful attempts to force the gunman out of the house, he was shot to death by the police after he appeared in a second-floor window, authorities said.
Minot Journal

Down-Home American, Korean Style

By JOHN ELIGON
When Geewon Anderson, a South Korean immigrant, bought Charlie's Main Street Cafe in Minot, N.D., she not only embraced the tradition the cafe represented, she also worked to bolster it.

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By MANNY FERNANDEZ
A bill in Texas would change not only how lawmakers conduct business, but also how often, in a state where legislators meet only in odd-numbered years.
OPINION
Opinion

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By STEPHEN BAKER
Social media networks were supposed to be the greatest marketing machines on earth. It hasn't worked out that way - yet.
Op-Ed Columnist

More Risk-Taking, Less Poll-Taking

By THOMAS L. FRIEDMAN
We've had lots of deal-making in Washington lately, but hardly any displays of courage from anyone.