BIS Quarterly Review, December 2015

6 December 2015

The BIS Quarterly Review for December 2015: Uneasy calm awaiting lift-off

Remarks by Mr Claudio Borio, Head of the Monetary and Economic Department, and Mr Hyun Song Shin, Economic Adviser & Head of Research, at the media briefing on 4 December 2015.

International banking and financial market developments

Uneasy calm awaiting lift-off
The interplay between the shifting prospects for policy normalisation in the United States, emerging market (EM) weaknesses and accommodation in other major advanced economies (AEs), drove market developments in the fourth quarter of 2015. Markets stabilised in October, following the August rout. Fears of a crisis centring on EMs faded as Chinese equity and currency markets - the rout's epicentre - entered calmer waters. Sentiment improved after policy interventions in EMEs and on ... More...
Highlights of the BIS international statistics
Cross-border banking activity shrank significantly between end-March and end-June 2015, more than reversing the first quarter's large expansion. Cross-border claims fell by $902 billion in exchange rate-adjusted terms during Q2 2015, according to the BIS locational banking statistics, slowing their annual growth rate to 1% at end-June 2015, down from 6% at end-March 2015. Claims also declined in ... More...

Special features

Dollar credit to emerging market economies
We profile the US dollar debt incurred by borrowers in a dozen prominent emerging market economies (EMEs). These countries account for the bulk of total US dollar debt owed by EMEs. We measure the dollar borrowing of non-banks resident in these economies as well as that of their affiliates offshore, and relate these items to commonly used debt measures. We also discuss the limitations of our data. These data fail to ... More...
Calibrating the leverage ratio
The Basel III leverage ratio (LR) is designed to restrict the build-up of leverage in the banking sector and to backstop the existing risk-weighted capital requirements (RWRs) with a simple, non-risk-weighted measure. But how should a minimum LR requirement be set? ... More...
Central clearing: trends and current issues
Central clearing of standardised financial instruments, as promoted by the G20 Leaders, addresses some of the financial stability risks that materialised during the Great Financial Crisis. Its rapid evolution since 2009 may have changed the linkages between central counterparties and the rest of the ... More...
Sovereign ratings of advanced and emerging economies after the crisis
The three major credit rating agencies have reassessed sovereign credit risks in the light of the Great Financial Crisis, increasing the transparency of their methodologies. This has resulted in material shifts in the rank-ordering of risks. Simple statistical models explain the lion's share of ratings differentials and capture some, but not all, of the ... More...

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