Who is overseeing the clean-up at the Federal Deposit Insurance Corporation (FDIC) after the disgraced regulator's misogyny scandal? That story and lots more on Basel Endgame easing, Draghi's call to arms on securitisation and APP fraud can be found below in our regular weekly round-up.
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💡 Mario Draghi is leading calls for a revival of the securitisation market to “transfer some risk to investors” and turbo-boost bank lending across the bloc’s moribund economy. 🔓 The former president of the European Central Bank says banks’ balance sheets will become more “flexible” as a result, allowing them to release capital and unlock additional finance. 📊 Draghi says the European Commission should “adjust prudential requirements” and reduce capital charges for securitised assets. 🏦 He is advocating the creation of a “dedicated” central securitisation platform, while noting that transparency and due diligence rules “remain high compared to other asset classes”. ❗ Experts have broadly welcomed Draghi’s call, but warn that loosening prudential frameworks could pose financial stability risks. ⁉ How do you think this will impact Europe’s banking sector? Will it boost lending or introduce new risks? Story by Giovanni Legorano. Read more below👇 https://lnkd.in/eXY8NZdQ Insights from @Sebastian Mack , a senior policy fellow at the Jacques Delors Centre and Shaun Baddeley from AFME (Association for Financial Markets in Europe). #Securitisation #BankLending #FinancialStability
Draghi’s securitisation call: risky business or overdue reform? - Banking Risk and Regulation
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🚨 Who is the woman overseeing the Federal Deposit Insurance Corporation (FDIC) clean-up? Step forward Carrie H. Cohen. ❗The move comes after a May report exposed a deeply entrenched “misogynistic” and “insular” workplace culture within the US regulator, prompting the resignation of FDIC chair Martin Gruenberg. 🔧 The revelations of strip club visits, lewd messages, heavy drinking, bullying and retaliation against whistleblowers shook the institution to its core. “We look forward to getting right to work,” Cohen tells Banking Risk and Regulation on the job in hand. 💡 Find out more about Carrie Cohen and what her role will entail. Story by Ellesheva Kissin. Read more below👇 https://lnkd.in/ebvd7Wqq #WorkplaceCulture #Leadership #FDIC
Carrie Cohen: who is the woman overseeing the FDIC clean-up? - Banking Risk and Regulation
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🔍 Amid the recent sound and fury over timelines and thresholds of reimbursing victims of authorised push payment fraud, the most significant issue around is being overlooked: preventing the scam in the first place, writes Nicky Goulimis of Tunic Pay. 💡 The debate sparked by the UK regulator’s decision to slash maximum fraud reimbursements from £415,000 to £85,000 represents an opportunity, I believe, to align incentives to reduce losses with an improved customer experience. 💸 What has been under-reported is that banks and fintechs will still have to pay a not-insignificant bill. Research by the Payment Systems Regulator has found that the lower threshold will still cover more than 99 per cent of APP fraud cases by volume, and the remainder of cases will simply be redirected to the Financial Ombudsman Service for further remediation. 🤝 Rather than finger-pointing, the UK sector should focus on how information sharing can benefit both the industry and consumers, reducing fraud likelihood. Read more https://lnkd.in/emGQxQZH #APPFraud #AuthorisedPushPayments #Banking
APP fraud shouldn’t mean All Payments Pending - Banking Risk and Regulation
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📣 Calls are mounting in the US to reform financial penalties and rules, with SEC commissioner Hester Peirce leading the charge in an exclusive interview. ⚖️ Peirce, a vocal critic of the U.S. Securities and Exchange Commission, has lambasted the “race to bigger fines” mentality and insists that her employer must clarify how it calculates penalties. 🔮 Tipped as a potential successor to Gary Gensler if the Democrats lose the neck-and-neck presidential election, Peirce has given voice to growing discontent with US regulators’ increasing assertiveness. 💰 On fines, Peirce says: “It becomes almost a race to say: ‘Oh, we outdid last year.’” SEC penalties in 2023 were the second highest in its history, at nearly $5bn. 📊 She adds: “In terms of the penalty calculations, we could help people by being transparent about how we think about calculating the number of violations.” 🏛️ Momentum for reform is growing in Congress and the courts, amid concerns about politicised rule-making and escalating fines. 👀 Read more here. Story by Victor Smart. https://lnkd.in/eJAtdS3d #SEC #USregulation #Banking
SEC’s Hester Peirce leads charge for penalty reforms - Banking Risk and Regulation
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The first work week of September is over and we've hit the ground running. Lucy McNulty of Following the Rules brings you nuggets on new bank rules from the outgoing CEO of the UK's Prudential Regulation Authority, Sam Woods. Plus more on non-banks from UBS' Colm Kelleher, why building societies are cautious about embracing open finance, the EU's new AI Act, how to get the most out of Microsoft Copilot, WhatsApp fines from the SEC, the leaked OCC 'Camels' report and instant payments in the EU. #Basel #finregs #banks
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💫 Sam Woods, the CEO of the Bank of England's Prudential Regulation Authority, recently took part in a Q&A with Lucy McNulty for her Following the Rules podcast https://lnkd.in/eKmgy4j5 Read an abridged version of Lucy’s podcast below. 🗣 In a wide and discursive conversation, he addressed Basel 3.1, Growth Duty and a refresh of “supervisory expectations” around climate rules. https://lnkd.in/ew_ydmcn #BankofEngland #UKplc #Basel3 #climate
PRA’s Sam Woods: ‘We will get rid of rules that are harmful to UK competitiveness’ - Banking Risk and Regulation
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💫 Sam Woods, the CEO of the Bank of England's Prudential Regulation Authority, recently took part in a Q&A with Lucy McNulty for her Following the Rules podcast https://lnkd.in/eKmgy4j5 Read an abridged version of Lucy’s podcast below. 🗣 In a wide and discursive conversation, he addressed Basel 3.1, Growth Duty and a refresh of “supervisory expectations” around climate rules. https://lnkd.in/ew_ydmcn #BankofEngland #UKplc #Basel3 #climate
PRA’s Sam Woods: ‘We will get rid of rules that are harmful to UK competitiveness’ - Banking Risk and Regulation
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🚨 The UK’s push towards open finance overlooks risks to financial stability and customer protection, warns research commissioned by building societies, but questions remain about whether ‘mutuals’ actually want to embrace the model. 🏦 Building societies, which largely offer their members mortgages and high-interest savings accounts, have been hesitant about the technology since it burst onto the scene in 2018. 🧊 Read how old-school 'mutuals' remain cool on algorithms taking over customers’ financial decisions... Story by Ellesheva Kissin. https://lnkd.in/d6CUDpe3 Insights from Kerri Sproson, senior strategy lead at Skipton Building Society, Robin Fieth, chief executive at the Building Societies Association, Chris Allen from consultancy Cognizant, Emily Shepperd chief operating officer at the Financial Conduct Authority and James Silk at consultancy firm Woodhurst. #BuildingSocieties #Mutuals #OpenFinance #OpenBanking
Building societies’ open finance fears: reality or reluctance? - Banking Risk and Regulation
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🤖 The European Union has won praise for the first attempt anywhere in the world to regulate AI. But critics say lawmakers are struggling to understand the technology and predict the AI Act, which came into law on August 1, will stifle innovation. 💐 Pioneers evidently get brickbats as well as bouquets. Gabriele Mazzini, who led the European Commission's drafting of the legislation, conceded in August that “the regulatory bar maybe has been set too high”. ⚖️ However, Farnoush Mirmoeini, founder of the regulatory fintech KYC Hub, maintains the EU has got the balance about right. “This isn’t a particularly draconian piece of legislation; it’s about transparency and documentation rather than curtailing new technologies,” she argues. 🚨 “But it is a warning to banks and other financial institutions not to experiment with AI unless they fully understand what they’re doing.” 🔍 Some banks may even be surprised to find themselves in the scope of the new laws. 📜 Critically, the AI Act applies both to technology developers and those, like banks, who are putting AI to work in their businesses. This includes those simply employing third-party AI applications and those adapting them to build a more sophisticated model. 💸 There are tough penalties for compliance failures, with maximum fines set at the higher of €35mn or seven per cent of the organisation’s total worldwide annual turnover. 👀 Read more below. Story by David Prosser https://lnkd.in/eQeYPeE5 #AIAct #AI #Banking #BankingIndustry
Has the EU’s AI Act set the regulatory bar too high? - Banking Risk and Regulation
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