Regulation of Financial Institutions
The latest developments in regulation and capital requirements for banks and insurers globally.

    11 Oct 2019|Moody's Investors Service
    Over the last week US bank regulators finalized several rule revisions loosening liquidity, capital and resolution-planning requirements as well as risk-taking restrictions for all but the very largest US banks and US operations of foreign banks, a credit negative.

    10 Oct 2019|Moody's Investors Service
    On 7 October, the European Central Bank (ECB) published its liquidity stress test results for 103 euro area banks. Overall, the stress test highlights a marked variation in euro area banks’ ability to cope with severe liquidity shocks. It demonstrated that there are pronounced pockets of vulnerability, with 75% of banks being unable to cope with a severe stress that lasted six months

    02 Oct 2019|Moody's Investors Service
    The EU’s second Payment Services Directive (PSD2), which gives authorised third parties access to bank customer data subject to the customer’s consent, is credit negative for incumbent banks, as it will over time increase competition and make deposit transfers more frequent. This will raise bank funding costs and liquidity requirements. However, the near-term impact will be limited due to banks’ large customer bases and strong investment capacity.

    26 Sep 2019|Moody's Investors Service
    The stress test scenario was designed well ahead of the recent decision of the European Central Bank (ECB) to lower the rate on its deposit facility to a negative 0.50%. Instead, the scenario tests the banks for a severe economic downturn combined with rising interest rates and credit spreads.