U.S. Agencies Stiffen LIBOR Sanctions in Concert with Global Standards
The Fed, OCC, and FDIC today quickly concurred with a proposal and supervisory statement from the LIBOR Benchmark Administrator and U.K. Financial Conduct Authority paving the way for a smooth transition away from LIBOR on USD LIBOR contracts before the year-end/2021 deadline while allowing legacy contracts to mature ahead of the June/2023 LIBOR “drop-dead” date. The FCA and U.S. agencies are now also looking at ways expressly to limit use of LIBOR, thus moving past entreaties to express enforceable demand.
Central Bankers, Supervisors Tell Basel to Relax Buffers, Finish Basel III, Set New Course
Continuing the raft of statements surrounding the G20 meeting last week, Basel’s Group of Central Bank Governors and Heads of Supervision (GHOS) now strongly encourage national regulators to make it clear that capital and liquidity buffers can and, if necessary, should be drawn down to support economic function during the pandemic.
Basel Toughens Treatment of NPL Securitizations
The Basel Committee today finalized amendments to its capital requirements revising the risk weightings for NPL securitization exposures.
BIS Staff: Embed Supervision Instead of Entrusting CBDC
A new paper from BIS staff differs from growing global central-bank consensus in favor of CBDC to argue that central-bank currencies may not achieve stablecoin’s useful purposes, recommending instead that DLT be used to “embed” supervisory protocols in private-sector alternatives.
CFPB Agrees to Advisory Opinions, Offers Two Major Ones
Following its pilot program earlier this year, the CFPB today finalized its advisory opinions policy allowing written requests for guidance on new products or other uncertainties.