-
Policy
Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM POLICY: -
G10 Markets
G10 Markets
Real-time insight on key fixed income and fx markets.
Launch MNI Podcasts -
Emerging Markets
Emerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
-
Commodities
Commodities
Real-time insight of oil & gas markets
-
Credit
Credit
Real time insight of credit markets
-
Data
-
MNI Research
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
-
About Us
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
-
Policy
Policy
Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
LATEST FROM POLICY: -
G10 Markets
G10 Markets
Real-time insight on key fixed income and fx markets.
Launch MNI Podcasts -
Emerging Markets
Emerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
-
Commodities
Commodities
Real-time insight of oil & gas markets
-
Credit
Credit
Real time insight of credit markets
-
Data
-
MNI Research
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
-
About Us
Real-time Actionable Insight
Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.
Free AccessMNI: BOE Cunliffe Focus on Bank Resolvability And Cyber Attack
By David Robinson
LONDON (MNI) - The Bank of England will consult at the end of this year on
a framework for assessing the progress major banks are making on resolution in
the event of their own financial failure, BOE Deputy Governor Financial
Stability Jon Cunliffe said.
Cunliffe said that one of the lessons of the Lehman Brothers collapse was
that not only was a system needed to cope with financial failure, but that
financial institutions, including central counterparties (CCPs,) needed plans
that were open to external evaluation for how they could handle their own demise
in an orderly way.
"The Lehman Brothers episode .. exposed brutally that insolvency is not an
option for large cross-border banks that perform critical economic functions.
One of the main objectives of the post crisis reforms has been to put in place
bank resolution regimes that enable the authorities to stabilize a failing bank
by bailing in its debt holders to restore solvency and regulatory capital,"
Cunliffe said.
--RESOLUTION FRAMEWORK
The BOE has been working on a bank resolution framework in case of failure
since back in 2014 but what needs to happen next is that the banks themselves
set out plausible resolution plans.
"The next phase of work will focus on ensuring that major banks have and
are able to demonstrate that they have the systems, documentation, assurance and
controls necessary to support their resolvability. We intend to consult at the
end of this year on the detail of this reporting and assurance framework. We
envisage that it will require major UK banks to conduct a self-assessment of
their resolvability - measured against the policies and standards that have been
established nationally and internationally," Cunliffe said at the FIA IDX
conference.
He also said that while the failure of a CCP was a very low probability
event one of the lessons of the global financial crisis was that plans needed to
be made for such tail risks. CCPs, like the major banks, need to set out plans
for resolvability.
"Public reporting and assessment of resolvability should act to strengthen
further confidence of other jurisdictions in the resolution plans of banks that
operate in their jurisdictions. Confidence that an effective resolution of a
clearing member can be effected will support a CCP and its supervisor 'staying'
the default of that member, in line with the international guidelines," Cunliffe
said.
The speech contained no reference to monetary policy or the current
economic conjuncture.
--CYBER ATTACK
In the question and answer session Cunliffe was asked about the threat of
cyber attack.
He said that the BOE Financial Policy Committee (FPC) back in 2013 made
assessing protecting critical infrastructure from cyber attack a priority but
that "this is never ending, this will be the challenge for years to come"
He added that the FPC would be saying more on this in its next report later
in June.
"We are working on it, we will always be working on it because the threat
is never ending," Cunliffe said.
--MNI London Bureau; tel: +44 203-586-2223; email: david.robinson@marketnews.com
[TOPICS: M$B$$$,M$E$$$]
To read the full story
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.