The Year’s Top Reads on Financial Reform
As we close out 2015, here is a selection of this year’s 10 most popular items from our “What We’re Reading” series. We look forward to bringing you exciting, new material in 2016 and wish you a happy New Year. The views expressed in these articles do not necessarily represent the views of the initiative, its co-chairs, task force members or BPC.
Compiled by Aaron Klein, Justin Schardin, Kristofer Readling and Olivia Weiss.
Global Insurance Regulatory Issues: Implications for U.S. Policy and Regulation
By the Insurance Task Force, Bipartisan Policy Center
“The far-reaching impacts of the global financial crisis of 2007-2008 triggered a robust debate about the proper structure and practices of financial regulation. … This paper is laid out in three sections. The first section gives a background of some of the major world, U.S., and EU actors in global insurance negotiations and their main efforts since the financial crisis. The second section summarizes key issues these actors and other policymakers are trying to hash out and what they mean. Finally, the third section presents several recommendations from the Bipartisan Policy Center’s Insurance Task Force.” Read the report here. Watch the release event here.
85th Annual Report
By the Bank for International Settlements
“The fragility of otherwise buoyant markets was underscored by increasingly frequent bouts of volatility and signs of reduced market liquidity. Such signs were perhaps clearest in fixed income markets, where market-makers have scaled back their activities and market-making has increasingly concentrated in the most liquid bonds. As other types of players, such as asset managers, have taken their place, the risk of ‘liquidity illusion’ has increased: market liquidity appears ample in normal times, but vanishes quickly during market stress.” Read the report here.
Reshaping the Financial Regulatory System: Long Delayed, Now Crucial
By The Volcker Alliance
“The analysis in this report aims to inform serious consideration of an issue of fundamental importance that, if resolved, would help establish and maintain a stronger financial system and foster a vibrant economy. This report should also help inform policymakers about: (1) how the current regulatory framework allows risks to multiply in the financial system; and (2) possible approaches to creating a more robust and resilient regulatory framework.” Read the report here. Read BPC’s support of the report here.
Discussion Draft of the Financial Regulatory Improvement Act of 2015
By Senator Richard Shelby (R-AL), Chairman, Senate Committee on Banking, Housing, and Urban Affairs
“Chairman Richard Shelby released a discussion draft of the Financial Regulatory Improvement Act of 2015 to continue reforms made by the Dodd-Frank Act. Shelby’s draft is intended to initiate a conversation with all members of the Committee who are scheduled to consider the bill and any potential amendments next Thursday.” Read the draft here. Read the draft summary here.
Dodd-Frank Five Years Later: The Good, The Questionable, And The Unintended
By Standard & Poor’s Ratings Services, McGraw Hill Financial
“While tangible strides have been made in many elements of the U.S. regulatory approach and framework since the crisis, one element that has not changed, in our view, is the patchwork quality of the regulating agencies. Unlike many other countries, in the U.S., what persists is a pluralistic regulatory architecture, with several agencies charged with oversight of banking, insurance, securities, and derivatives markets, and their domains continue to overlap occasionally, depending on the institution.” Read the report here.
Inside the FDIC: Thirty Years of Bank Failures, Bailouts and Regulatory Battles
By John F. Bovenzi, Member, Failure Resolution Task Force, Bipartisan Policy Center and Partner, Oliver Wyman
“Inside the FDIC tells the real stories behind bank failures and financial crises to provide a direct account of the Federal Deposit Insurance Corporation and other bank regulators. Author John Bovenzi served in senior level positions within the FDIC for over twenty years, including a decade as the Deputy to the Chairman and Chief Operating Officer. This book describes what he witnessed as the person in charge of day-to-day operations, as a nearly invisible agency grew to become a major, highly independent force impacting US financial markets.” Read the book description here.
The Business of Insurance and Banking: Understanding Two Different Industries
By the Insurance Task Force, Bipartisan Policy Center
“The business of insurance is fundamentally different from the business of banking. … This paper describes the differences between insurance and banking. It examines and compares key aspects of both industries: size, business models, distribution channels, regulatory oversight, safety and soundness, consumer protection, reasons for failure, resolution, and systemic risk.” Read the primer here.
Senate Democrats Urge Government Agencies to Investigate Potential Violation of the Fair Housing Act
By 14 Democratic senators including Robert Menendez (D-NJ), Sherrod Brown (D-OH), Elizabeth Warren (D-MA) and Chuck Schumer (D-NY)
“We have reviewed with great interest and concern a report of the National Fair Housing Alliance (NFHA). … The report found that REO properties in communities of color were much more likely to have a higher number of maintenance and marketing deficiencies, leading to destabilizing outcomes for families and neighborhoods. … According to NFHA’s report, the same communities who were victimized by predatory mortgage lending practices may now be facing additional burdens from unequal and inadequate management of foreclosed homes.” Read the letter here. Read the report here.
What’s the Best Way to Resolve a Global Bank? A Review of Comment Letters on Total Loss Absorbing Capacity (TLAC)
By Peter Ryan, Former Senior Policy Analyst, Financial Regulatory Reform Initiative, Bipartisan Policy Center
“Last November, the Financial Stability Board (FSB) released a proposal to put in place a new international failure resolution regime designed to address the too-big-to-fail challenge posed by the largest global banks. … Many stakeholders expressed concerns that parts of the proposed TLAC framework could undermine effective cross-border resolution, lead to competitive inequities, were insufficiently transparent to investors and could have adverse impacts on the real-economy.” Read the post here.
Wild Ride on Wall Street: Early Test of Liquidity?
By Aaron Klein and Kristofer Readling, Financial Regulatory Reform Initiative, Bipartisan Policy Center
“The stock market’s wild swing last week, including its sharpest sell-off since 2009, could provide an early indication of whether concerns about broader market liquidity declining are accurate, and if so, to what degree are financial regulatory reform or market evolution the cause.” Read the post here.
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