WASHINGTON, Oct 17 (Reuters) – Banks’ reliance on poor risk
models is among the problems the Federal Reserve found in its
health check of the largest U.S. financial institutions, as the
Fed explained for the first time on Friday what it thinks of
this year’s industry submissions.
The Fed’s list of flaws that come with banks’ disclosures
for the so-called stress test show that while progress has been
made, the two sides are still a ways off in their expectations.
WASHINGTON, Oct 17 (Reuters) – Fresh from a court win in
Britain, the London Metal Exchange now faces one of its biggest
hurdles yet in its years-long crisis over its warehousing policy
that consumers say has inflated prices: convincing U.S.
lawmakers its reforms are enough.
When Britain’s Court of Appeal handed a victory to the LME
last week, knocking out a challenge to the reforms by Russian
aluminum giant Rusal last week, the LME’s head of
business development, Matt Chamberlain, was in Washington, a
source familiar with the matter said.
WASHINGTON, Oct 11 (Reuters) – Downside risks to the global
economy are a factor the Federal Reserve will have to consider
even as the U.S. economy recovers from the 2007-2009 financial
crisis, Fed Governor Daniel Tarullo said on Saturday.
Tarullo, a voting member of the Fed’s policymaking
committee, also said the U.S. economy is facing deep problems
from decaying infrastructure to a polarized income distribution
that could weaken demand in the future.
WASHINGTON (Reuters) – Regulators from the United States and the United Kingdom will get together in a war room next week to see if they can cope with any possible fall-out when the next big bank topples over, the two countries said on Friday.
Treasury Secretary Jack Lew and the UK’s Chancellor of the Exchequer, George Osborne, on Monday will run a joint exercise simulating how they would prop up a large bank with operations in both countries that has landed in trouble.
WASHINGTON (Reuters) – A much-needed pruning of banks across the world could stifle lending and dampen economic recovery, the International Monetary Fund said on Wednesday.
To boost profits, banks need to raise prices in certain business lines, pull out of others altogether, and put their money where it yielded more, the Fund said.
WASHINGTON (Reuters) – The U.S. top financial risk council may tweak the way in which it identifies insurers and other companies that are not banks as systemically important, a process the industry and politicians have fiercely criticized.
The Financial Stability Oversight Council, a group of the nation’s main financial regulators, has named three such companies as being so important that their demise could pose risks to the global system, subjecting them to tougher oversight.
WASHINGTON (Reuters) – Insurer MetLife said on Friday it would fight a plan by the U.S. risk council to designate it as a firm whose demise could risk global finance, a tag that brings far greater regulatory scrutiny.
The company had asked the Financial Stability Oversight Council (FSOC) to call a meeting at which it could give written and oral evidence of why it disagreed with the proposed determination, it said in a regulatory filing.
LONDON/WASHINGTON, Oct 3 (Reuters) – The world’s largest
banks are pushing regulators for more flexibility in the last
major set of rules to come out of the global financial crisis:
requirements that would double the capital cushion banks are
forced to hold.
Leaders of the 20 most important economies, the G20, in
November will issue a draft rule, which many of the biggest
banks say need to be tailored to each institution.
WASHINGTON (Reuters) – High-frequency trader Michael Coscia was charged with manipulating commodity futures prices in the first U.S. federal criminal prosecution of the practice of “spoofing,” the Justice Department said on Thursday.
Coscia and his high-speed trading firm, Panther Energy Trading, were fined $3.1 million by regulators in the United States and Britain in July 2013 for market manipulation and ordered to disgorge $2.7 million in profits.
WASHINGTON, Oct 1 (Reuters) – Regulators should keep a close
watch over the shadow banking system to protect its useful
functions without any undue risks to the financial system, the
International Monetary Fund said on Wednesday.
Shadow banks are a loosely defined group of financial
industry operators that provide credit without officially being
banks, such as hedge funds, money market funds, finance
companies and securitization vehicles.