Posts tagged 'Banking Union'

Banking union’s house of twigs (with cut out and keep optionality)

David joined the FT in 2011 as a Marjorie Deane fellow. He covered emerging markets, equities and currencies before making the jump over to FT Alphaville in May 2012.

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| May 30 15:41 | Comment |

About that banking union and the aspiration to “break the feedback loop between banks and sovereigns”…

From JP Morgan’s Alex White:

It has been clear for some time that this is not fully achievable in the near term, because of the extent of the institutional journey required (likely including the prospect of Treaty change). For the foreseeable future, Europe’s banks will be left with what Minister Schauble has explicitly referred to as a “timber-framed” Banking Union. This will emphasize that the heavy lifting has to be done at the national level, and will be based around the development of national resolution regimes.

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Exorcising eurozone ELA as we know it

Joseph joined FT Alphaville way back in March 2010. He likes all the politically and legally fiddly bits of finance. He also likes credit, rates, global macro, tail risk, and all that stuff. (You should email him story ideas. He’ll take anything.)

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| Feb 13 17:52 | Comment |

Yes the IMF calls for common eurozone deposit insurance, in this new banking union paper. But also look at what they suggest on emergency liquidity assistance:

Lender of last resort. The lender of last resort makes liquidity support available to solvent yet illiquid banks. Centralizing all LOLR functions at the ECB would in the steady state eliminate bank-sovereign linkages present in the current ELA scheme (see Box 1). This would require changes to the ECB’s collateral policy, as by definition euro area banks that tap ELA cannot access Eurosystem liquidity owing to collateral constraints. Until such time as all banks are brought under the ECB’s supervisory oversight, ELA would be sourced through both the ECB (for banks brought under its purview) as well as national central banks (for banks that remain under national supervision, albeit with adjustments made to the national ELA limits).

Which would be nothing short of a revolution. Read more

The sticks and carrots of a banking union

David joined the FT in 2011 as a Marjorie Deane fellow. He covered emerging markets, equities and currencies before making the jump over to FT Alphaville in May 2012.

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| Dec 13 2012 09:32 | Comment |

We have a banking union, kinda, sorta. After another marathon summit that stretched into the early hours of Thursday morning — with four hours apparently devoted to overcoming the differences between Paris and Berlin — a classic euro-fudge left everyone feeling relatively satisfied. From the FT:

While the compromise could permit all sides to declare political victory, it remains unclear whether the details effectively establish a two-tier regime or give the ECB ultimate responsibility for all banks.

Shocking. Read more

Were Hollande and Merkel at the same summit?

Masa joined the FT in 2009 and has worked on a number of desks across the paper, including Companies, Markets and Comment. She spent much of 2010 in New York covering the US equity markets. But earlier this year she finally saw the light and moved to Alphaville.

She started her career in the investment banking division at Lehman Brothers in the summer of 2007, timing it perfectly with the beginning of the credit crunch.

She studied philosophy, politics and economics at Oxford University.

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| Oct 19 2012 15:28 | Comment |

Listening to the comments of the various European leaders this morning, you’d be forgiven for thinking that they were attending different summits yesterday.

Francois Hollande, as quoted by the FT (emphasis ours):

The topic of this summit is not the fiscal union but the banking union, so the only decision that will be taken is to set up a banking union by the end of the year and especially the banking supervision.

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Half time at the summit

David joined the FT in 2011 as a Marjorie Deane fellow. He covered emerging markets, equities and currencies before making the jump over to FT Alphaville in May 2012.

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| Oct 19 2012 08:50 | Comment |

And we have some very small bits of progress. And, naturally, plenty of kinks. Here’s a handy run down from JP Morgan’s Alex White: Read more

What Germany, France and van Rompuy want in a fiscal union (with optional caption competition)

Kate is FT AV’s Asia Correspondent. She joined FT Alphaville in mid-2011 after carrying out various roles in the FT’s London office since 2005: interactive editor, companies reporter, and founding editor of the FT’s Energy Source blog.

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| Oct 17 2012 08:55 | Comment |

We just had to highlight this excellent cut-out-and-keep guide, from today’s print FT, to the tussle over banking union, fiscal union, and debt mutualisation:

What Germany, Spain and France want ahead of Spanish bailout request/Brussels summit Oct 2012 -- FT graphic text by Peter Spiegel  Read more

Buiter on good news, bad news

David joined the FT in 2011 as a Marjorie Deane fellow. He covered emerging markets, equities and currencies before making the jump over to FT Alphaville in May 2012.

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| Sep 24 2012 13:39 | Comment |

Citi’s Willem Buiter has gone all good idea/bad idea on us.

= the introduction of the ECB’s Outright Monetary Transactions (OMT) facility, the decision of the German Constitutional Court to allow German participation in the ESM with small additional conditions, and the strong performance of centrist, pro-European parties in the Dutch election. Read more

Let’s not be afraid of… banking union

David joined the FT in 2011 as a Marjorie Deane fellow. He covered emerging markets, equities and currencies before making the jump over to FT Alphaville in May 2012.

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| Sep 12 2012 11:00 | Comment |

It’s a proposal from the EU Commission. You know, the one that wants to move towards a ‘federation of nation states‘:

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Searching for common ground on a European banking union

Masa joined the FT in 2009 and has worked on a number of desks across the paper, including Companies, Markets and Comment. She spent much of 2010 in New York covering the US equity markets. But earlier this year she finally saw the light and moved to Alphaville.

She started her career in the investment banking division at Lehman Brothers in the summer of 2007, timing it perfectly with the beginning of the credit crunch.

She studied philosophy, politics and economics at Oxford University.

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| Aug 15 2012 14:56 | Comment |

With the EC set to outline its proposals for a European banking union in less than a month’s time, leaked documents detailing the initial discussions indicate differences of opinion remain as wide as ever.

A key area of contention seems to be delegation of banking oversight tasks. From Bloomberg (our emphasis): Read more

Cheat sheet for Europe

| Jun 20 2012 21:33 | Comment |

What can Europe do? SocGen has a handy little chart:

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What comes first: European banking, political, or fiscal union?

Lisa joined FT Alphaville in September 2011 after a tour of duty through the guts of the financial industry, having worked as an analyst at a bank and for a financial data company. She's now the Head of New Projects for FT.com.

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| Jun 18 2012 14:02 | Comment |

It’s a commonly-held belief that the bailout of Spain’s banks won’t be sufficient to solve the country’s problems. It will increase the government’s borrowing, and may not be large enough anyway.

The real solution is fiscal banking political some kind of union. See if you can spot one of the barriers to moving forward with that: Read more

A banking union “no go” summary

David joined the FT in 2011 as a Marjorie Deane fellow. He covered emerging markets, equities and currencies before making the jump over to FT Alphaville in May 2012.

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| Jun 12 2012 12:25 | Comment |

A few things that are worth being taken together. First from José Manuel Barroso in the FT (with our emphasis):

All 27 EU countries should submit their big banks to a single cross-border supervisor as part of a banking union to be enacted as soon as next year, the president of the European Commission has urged. Read more