Macro-prudential Policy: Implementing the Financial Stability Mandate

Macro-prudential Policy: Implementing the Financial Stability Mandate

Macro-prudential Policy: Implementing the Financial Stability Mandate

19th to 22nd May 2020, Royal Berkshire Hotel, Windsor

Course Chair: Maria Nieto, Advisor in the Directorate of Financial Stability, Regulation and Resolution, Bank of Spain

 

Day 1 Macro-prudential Policy: Navigating a Volatile Landscape

Global imbalances and financial stability: understanding the dynamics
Eva Hüpkes
, Adviser, Regulatory Policy and Cooperation, Financial Stability Board (invited)

  • Key factors and dynamics shaping the financial stability landscape in 2020
  • Overview of emerging financial, operational and conduct risks
  • New roles and responsibilities for financial regulators and supervisors
  • Discussion: impact of the FSB’s 2020 agenda on local jurisdictions and the global financial system

 

Climate risks as the new source of systemic instability
Maria Nieto
, Advisor in the Directorate of Financial Stability, Regulation and Resolution, Bank of Spain

  • Implications of climate change for the stability of financial systems
  • Overview of key transition, physical and liability risks
  • The role of financial policy and regulation in effective climate risk mitigation
  • Hands-on exercise: application of supervisory tools and prudential responses

 

Tackling financial stability implications of CBDCs, crypto assets and stablecoins – a user’s guide
Workshop with Klaus Loeber,
Head of Oversight, European Central Bank

  • Differences and overlaps between privately issued crypto assets, stablecoins and central bank digital currencies (CBDC)
  • Building blocks of effective regulatory and supervisory frameworks for privately issued crypto assets and stablecoins
  • Implications of CBDCs for financial stability, payments and settlements
  • Discussion: do CBDCs represent a realistic and desirable goal?

 

 

Day 2 Building an Effective Framework against Systemic Risk

Macro-prudential policy in 2020: operationalising the systemic framework
Morgan Despres,
Head of Financial Regulation Policy and Coordination Division, Banque de France (invited)

  • The state of the art of macro-prudential policy
  • Examples of good practice in monitoring, reporting and counteracting threats
  • Opportunities and challenges for coordination with the price stability mandate and micro-prudential responsibilities
  • Discussion: would macro-prudential oversight have prevented the last crisis? (and will it prevent the next one?)


BigTech: the new focus of regulatory attention
Anand Sinha,
former Deputy Governor, Reserve Bank of India

  • Characteristic features of the BigTech sector and entities
  • Impact and implications of BigTech for the financial services and technology providers
  • Overview of local and cross-jurisdictional efforts focused on regulation and supervision of BigTech
  • Discussion: who are the BigTechs in the delegates’ home jurisdictions?

 

The institutional alignment of macro- and micro-prudential policy: the case of the euro area
John Fell
, Deputy Director General, Macro-prudential Policy and Financial Stability, European Central Bank

  • Tips for effective coordination and calibration of macro- and micro-prudential policy
  • Implications for institutional arrangements and organisation
  • Examples of mechanisms for a continuous exchange of information for conflict resolution
  • Case study: macro- and micro-prudential supervision in the euro area

 

Systemic stress-testing: the state of the art
Karsten Gerdrup,
Director, Monetary Policy and Financial Stability Modelling, Norges Bank

  • The evolving role of systemic stress-testing in financial stability
  • Key features of effective stress-testing models and frameworks
  • Opportunities and challenges of disruptive technological innovation
  • Case study: stress-testing of the banking system in Norway

 

Will a cyber-attack cause the next financial crisis?
David Porter,
Senior Advisor, Cyber Security and Infrastructure, Bank of England (invited)

  • Overview of financial, operational and regulatory risks for infrastructures based on computer systems and digital information
  • Examples of systemic implications of successful cyber attacks
  • Key features of effective cyber resilience frameworks and strategies
  • The role of cross-industry guidance and public-private cooperation and coordination

 

Day 3 New Developments in Financial Stability Toolkit

RegTech and SupTech: new opportunities in financial stability and systemic risk analysis
Moad Fahmi, Special Advisor – FinTech, Bermuda Monetary Authority

  • Technological foundations of regulatory and supervisory technology
  • The impact of RegTech and SupTech on financial services industry
  • Key applications in regulatory reporting and compliance risk management
  • Discussion: how to supervise technological innovation?

 

Making the most of Big Data and advanced analytics in macro-prudential analysis
Allan Kearns,
Head of Function – Prudential Analytics, Central Bank of Ireland

  • Examples of regulatory and supervisory applications of Big Data and advanced data analytics
  • Opportunities and challenges of APIs (Application Programming Interface) and new software platforms for financial stability and systemic risk analysis
  • Implications for central banks’ resourcing and institutional organisation
  • The role of cooperation and coordination with the private sector

 

The central credit register and effective calibration of macro-prudential instruments
Selva Bahar Baziki, Director, Banking and Financial Institutions Department, Central Bank of the Republic of Turkey

  • Overview of central credit registers as micro- and macro-prudential tools
  • Examples of credit register data applications for detecting risk build-up and concentration
  • Tips for calibration of macro-prudential instruments and assessment of their effectiveness
  • Case study: building a new central credit register framework

 

Day 4 Looking Towards the Future:  Innovations, Opportunities and Challenges

What is the true potential of machine readability in regulation and supervision?
A speaker from FCA
or Anne Leslie-Bini, Senior Managing Consultant, IBM Security Centre for Competence Europe

  • The state of the art of machine-readable regulation
  • Opportunities and challenges for risk-based supervision, data quality assessment, and closing of the gap between regulatory intention and interpretation
  • The emerging role of cognitive compliance
  • Discussion: does machine-executed regulation represent a realistic and desirable goal?

 

The emerging sources of financial instability for 2021 and beyond
Panel with
Anand Sinha, former Deputy Governor, Reserve Bank of India, Allan Kearns, Head of Function – Prudential Analytics, Central Bank of Ireland and Moad Fahmi, Special Advisor – FinTech, Bermuda Monetary Authority

  • Overview of short-term and long-term threats to financial stability
  • Assessment of reports, frameworks and approaches by global authorities including the IMF, Basel Committee and the United Nations
  • Key expectations in relation to financial stability implications of climate, cyber and technology risks
  • Discussion: what are the ‘most feared’ sources of financial instability in delegates’ home jurisdictions for 2021 and beyond?

 

Action points and key takeaways
Maria Nieto, Advisor in the Directorate of Financial Stability, Regulation and Resolution, Bank of Spain

  • Summary of the training course
  • Discussion of the observed trends and case studies
  • Application of learning points in the delegates’ home organisations
  • Preparation of action points