Policy portal Stability & Supervision

When trust in the financial system disappears, panic sets in: fire sales of financial assets and bank runs can make the entire system collapse. Taxpayers are forced to bail out “too-big-to-fail” institutions to protect essential economic functions (deposits, credit, payment systems).

Mitigating implicit “moral hazard” requires sound prudential policies protecting essential banking services from excessive risk-taking and maintaining adequate capital levels to cover possible losses. Well-resourced, and independent supervision is also key. Finally, prudential regulation must also respond to new risks related to digitalisation (see “Digital Finance”) and climate change (see climate risk under “Sustainable Finance”).

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8 PUBLICATIONS

Consultation response

Consultation response on EBA’s proposals for a STS framework for synthetic securitisation

Factsheet

Cheat sheet: What is Long Term Financing?

Contents: Background; Actions of Finance Watch; Key risks; and our Publications on this dossier.
Factsheet

Cheat sheet: What is MiFID II (Level 2)?

Background; Actions of Finance Watch; Key risks; and our Publications on this dossier.
Consultation response

Response to ESMA consultation on MiFID II/MiFIR Technical Standards

Consultation response

Response to EC shadow banking consultation

Position paper

MiFID II position paper “Investing not betting”

Position paper “Investing not betting” on MiFID II, the EU’s revised Markets in Financial Instruments Directive. Press release 24 April 2012.
Factsheet

Cheat sheet: Short selling / naked CDS

Short selling involves selling a security one does not own and replacing it with one bought at a later date to benefit from a fall in price. Credit default swaps (CDS) are derivatives that protect against default, paying out like insurance policies if the creditor (a company or a country) defaults. Their value usually rises as a default looks more likely.
Position paper

Position paper on sovereign CDS

Finance Watch has published the first in a series of short position papers where it highlights situations where a private interest is disguised as a public interest argument. Presse release 11 July 2012.

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