If stress tests of US and EU clearinghouses are to identify consequences of bank and clearinghouse collapses for the financial system, they must include more jurisdictions, banks and risk scenarios and must be performed more frequently, according to a Federal Reserve working paper. Clearinghouse testing by US and EU regulators "is in its infancy," the paper says.
British Prime Minister Theresa May has told an EU committee that UK parliamentary approval of the Brexit deal is still possible but that an orderly withdrawal is at risk. The EU has said the backstop deal to prevent a hard border between Ireland and Northern Ireland is intended to be temporary and has refused to give legally binding guarantees.
Global systemically important banks had a different composition of exposure as measured under the leverage ratio through 2017, with derivatives and repo accounting for less exposure at Japanese and eurozone G-SIBs than at US, UK and Swiss G-SIBs.
A working group on risk-free rates at the Bank of England wants greater focus on adoption of the Sterling Overnight Index Average. "It would be appropriate to begin considering more granular milestones with a more targeted approach," according to minutes from the group.