MNI BRIEF: Revision, Not Revolution Best For Bank Rules - ECB

Banking supervisors should adjust reporting frequencies and certain liquidity ratios while fine-tuning regulatory frameworks following recent market turmoil linked to rapid interest rate rises, ECB Supervisory Board member Kerstin af Jochnick said in a speech Wednesday.

Globally banks are more resilient to shocks thanks to better regulation and supervision post-Basel, she said. However monetary policy normalisation has led to increased net interest margins for some, while increasing risk management challenges for others.

“It would also seem essential to enhance the transparency of credit default swap (CDS) markets,” af Jochnick said, noting that “weaknesses on the risk management side often go hand-in-hand with deficiencies in banks’ governance frameworks.”

Kerstin af Jochnick spoke at length with MNI in an interview published Monday (MNI INTERVIEW: Italy NPL Plans Stray From Norm-Bank Supervisor)