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- Credit Outlook Survey reveals global uncertainty
While the forecast for European corporate bonds remains uncertain, North American bonds are expected to see continued improvement, according to the latest quarterly IACPM Credit Outlook Survey. “Global economic growth is poor to anemic and our survey respondents aren’t very confident help is around the corner,” said Som-lok Leung, Executive Director of the International Association of Credit Portfolio Managers. “Central banks aren’t eager to provide more economic stimulus so market participants are adjusting to life without it.” Read the IACPM news release.  Reuters
(4/18), Nasdaq.com/Dow Jones Newswires
(4/18)     
- European banks are on fast track to reining in assets
Europe's economic troubles are being exacerbated by banks that are quickly adopting tougher capital rules. The move increases the risk that they will run out of money to lend to support the economic recovery. If banks cannot raise capital, they might have to cut 30% of assets, one consultant said. Most analysts predicted a more modest reduction: 5% to 7%. Reuters
(4/19)
- Cross-border banking starts to unravel
Before the global financial crisis, cross-border banking was growing rapidly, with European banks taking the lead during an era of internationalization. Now, lenders are retreating from cross-border business as their willingness and ability to compete falter. The Economist
(4/21)
- Credit crunch in Europe would deepen recession, IMF says
The International Monetary Fund warned that if European banks simultaneously take strong measures to fix their balance sheets, a major credit crunch might occur. The IMF expects 58 of the biggest EU banks to shed $2.6 billion in assets by the end of next year, nearly 7% of their total. The IMF predicted that the euro-zone economy will shrink 0.3% this year, then expand 0.9% next year, but a credit crunch would reduce gross domestic product 1.4% after two years. The Guardian (London)
(4/18)
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- EU stumbles over capital rules for banks
Diplomats said EU states are divided on how much leeway national regulators should have when it comes to capital requirements for banks and keeping markets stable. "They were not close to agreement, and there is a lot more work to do," one diplomat said. An added wrinkle is the January phasing in of Basel III rules. Reuters
(4/19)
- FSB urges banks to use cash for Basel III buffers
The Financial Stability Board said banks can meet the tougher Basel III capital requirements by retaining more earnings. Chairman Mark Carney said the largest banks will need about 1.5 times their combined profits for 2011 to meet the rules, which are being phased in over six years. "Hence, although there is considerable variation across banks, the industry in aggregate has the capacity to meet the new targets through earnings retention and reduced distributions over the transition period," Carney said in a letter to Group of 20 finance ministers. Reuters
(4/20)
- Regulators give banks 2 years to comply with Volcker rule
The Federal Reserve and other regulators said banks will have two full years to comply with the Volcker rule. "A lot of sweating brows at big banks are a lot drier today," said Karen Shaw Petrou, a managing partner at Federal Financial Analytics. "The statement finally makes clear that they can't be held accountable for compliance with a rule not yet released." Bloomberg
(4/19)
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Corporate bond market sees few adverse effects from Volcker rule: Concerns that the Volcker rule will negatively affect market making for corporate bonds appear to be unfounded as the corporate bond market has flourished, according to this analysis. Companies issued $403 billion of new debt in the first quarter of 2012, more than in any of the preceding four quarters. The New York Times (tiered subscription model)/DealBook blog
(4/20)
- EU pushes for delay in U.S. swaps-dealer regulations
Michel Barnier, the EU's internal-market commissioner, wrote to numerous U.S. government agencies expressing concern about how over-the-counter derivatives regulations will affect European firms. He asked for postponement of certain provisions. "Commissioner Barnier has sent letters ... encouraging them to delay the swap-dealer registration process as regards EU firms until there is legal clarity about the substantive conditions that such registration will entail," a spokeswoman said. Reuters
(4/23), Bloomberg
(4/23), City A.M. (London)
(4/24)
- Commentary: Industry focuses on derivatives rules
Roger Lowenstein, author of "When Genius Failed: The Rise and Fall of Long-Term Capital Management," examines the efforts of industry groups as they offer input on regulations to govern derivatives in the wake of the global financial crisis. Meanwhile, industry groups have been striving to ensure the rules don't have unintended consequences or cause other issues. Bloomberg
(4/17)
| IACPM News | | |
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- The IACPM Spring General Meeting has been approved for CFA credits.
The CFA Institute has approved this program, offered by the International Association of Credit Portfolio Managers, for 8.5 CE credit hours. If you are a CFA Institute member, CE credit for your participation in this program will be automatically recorded in your CE Diary. For more information and to register for the Educational Seminar and the Spring General Meeting visit our website at www.iacpm.org.
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 | One way to keep momentum going is to have constantly greater goals."
--Michael Korda,
British-American writer
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| About IACPM |
The IACPM is an industry association established in 2001 to further the practice of credit exposure management by providing an active forum for its member institutions to exchange
ideas on topics of common interest. Learn more at www.iacpm.org.
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| | Recent IACPM Weekly SmartBrief Issues:
- Tuesday, April 17, 2012
- Tuesday, April 10, 2012
- Tuesday, April 03, 2012
- Tuesday, March 27, 2012
- Tuesday, March 20, 2012
| | | Lead Editor: Sean McMahon
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