FRB-NY Staff: Big-Bank Market Power Argues for Tougher Liquidity Rules, Antitrust Action
In a timely post given ongoing discussions about U.S. competition (see Client Report MERGER6), a recent Federal Reserve Bank of New York staff note evaluates fire-sale risk in light of financial-sector concentration. As the post points out, virtually all recent work on post-2008 capital and liquidity regulation posits friction-free competition which is an artifact of model convenience, not of market reality. Models thus assume that fire-sale considerations result in externalities such as undue leverage.
Senate Democrats Turn to CFPB for Credit-Reporting Reform
Senior Senate Democrats have now upped their demands of credit-reporting agencies and the financial institutions that provide key data, calling on the CFPB to ramp up an array of requirements they believe would enhance financial inclusion.
Basel Implements Promised Market-Risk Disclosures, Backs Down on Sovereign Weightings
As presaged on Tuesday, the Basel Committee today released new market-risk and voluntary sovereign-debt disclosures.