Banking Risk and Regulation

It is not often that one hears of fintechs having sympathy for the very people they set out to disrupt: bankers. However, a case in Ireland against senior banker David Guinane has set alarm bells ringing at fintechs, insurers, asset managers and funds companies. The information released last week in the matter of former bank CEO Mr Guinane and the Central Bank of Ireland has created a lot of discussion both in Ireland and overseas. Thank you to Farah Khalique of Banking Risk and Regulation, a specialist publication under the Financial Times umbrella for the opportunity to write an opinion piece on the matter. The matter should be appreciated by senior management of regulated #fintech and others that are impacted by this legal requirement 'persons concerned in the management' notwithstanding they may not be affected by the introduction of the new Senior Executive Accountabbility Regime in Ireland. https://lnkd.in/ezbQKtZp #SEAR #individualaccountability #riskmanagement

⚠️ A new triple threat is piling pressure on the second line of defence, writes Emily Wright. 👀 In the coaching room, I’m observing worrying patterns affecting risk professionals — especially in leadership. But all is not lost. 🔎 My role as a consultant — which I started two years ago after more than 20 years in the industry — allows me to zoom out and see what’s affecting my peers. These strains demand new approaches, especially from people at the top. 📌 Through lessons from my work as an executive coach to risk industry leaders, I can share with you the five practices that come up again and again to help manage these exhausting new demands. ⬇️ Read more below. https://lnkd.in/eiPFcGXQ #2LOD #Banking #BankingRisk

📢 The financial watchdog’s plan to name and shame companies under investigation was poorly communicated, lacked sufficient evidence, and underestimated the risk to firms and market stability, a UK House of Lords committee has said in a scathing report, writes John Crowley. ⚖️ In a damning assessment, the Financial Conduct Authority’s senior leadership was accused of “exercising poor judgement” and “losing control of the narrative” as it attempted to justify its proposal to publicise investigations into financial services firms. 🔄 Speaking exclusively to Banking Risk and Regulation, Lord Michael Forsyth, chair of the Financial Services Regulation Committee, said the FCA requires “cultural change.” ❓ Declining to comment on whether the FCA remains fit for purpose, Lord Forsyth said that would be a “very pertinent question” for the committee’s investigation into regulators’ secondary growth objective. This separate inquiry is due to report after Easter, he said. 📜 The peers, who received written evidence from over 40 industry leaders, took oral evidence solely from FCA chief executive Nikhil Rathi and its chair Ashley Alder. 🤔 “With the benefit of hindsight, I don’t think the FCA would have approached [this] in the way they did,” Lord Forsyth declared. 🚨 “What worries me is what it says about the culture and the way the regulator is operating.” 👀 Read more below. https://lnkd.in/d33BhgdB #NameandShame #FCA #UKBanking

Hello Everyone, I am thrilled to share my first story for Financial Times’s Banking Risk and Regulation. https://lnkd.in/eMPYBXwq Kindly, feel free to share your thoughts on the story. I’d appreciate to get in touch if you have any tips, insights, or interesting topics you'd like to discuss. Gandhi R Franco Thomas, Jean Dreze, Jiji Mammen Sadaf Sayeed Arun Kumar Dr. Kishore Nuthalapati Thank you all for your insights. Also, thank you Farah Khalique and John Crowley for giving me this opportunity and trusting my work.

📉 India is slashing red tape and embracing deregulation to boost its faltering economy, despite a surge in riskier borrowing that threatens banks’ loan books, writes Sweta Roy. 📊 The country’s annual economic survey, an outlook published by the finance ministry alongside the Budget, signals a sharp policy pivot. Moving away from previous commitments to tighter oversight, it now calls for a comprehensive reassessment of rulemaking and fiscal support. ⚖️ Mentioning “deregulation” 57 times, the finance ministry acknowledges the “swift and sustained focus on regulation” ushered in by US president Donald Trump’s new administration. 📢 “The call for enhancing economic freedom through deregulation has renewed momentum in today’s rapidly evolving global economy. Overregulation stifles innovation and economic dynamism,” it says. 🏦 Now, India’s “super regulatory body” will build a framework to review financial regulations and identify areas for improvement. Leading figures on the Financial Stability and Development Council include the governor of the Reserve Bank of India (RBI), the nation’s finance secretary and the chairs of major financial regulators. 📉 The pro-growth shift comes as the country's National Statistics Office has revised India’s growth forecast downwards. 👀 Read more below. https://lnkd.in/eMPYBXwq #India #IndiaBudget #Banking #BankingIndustry #RBI

The U.S. banking industry has increasingly been taking on its regulators when it doesn't agree with them as shown by recent lawsuits filed by industry groups and an individual firm against the exact agencies who are assigned to watch over them. Why? Experts point to a recent spate of Supreme Court decisions that have have given banks more firepower to do this. My latest for Banking Risk and Regulation: https://lnkd.in/e_-QFWW7

Thank you Banking Risk and Regulation, Farah Khalique and John Crowley for the opportunity to write this op-ed for the Financial Times! - What lessons do banks have to keep learning from physical events? - What can they change in their processes, their front-line-to-risk interactions, their leadership, their general approach? - What will bailouts look like a few risk events down the line and who will bear the cost? I'm grateful to my US network for your invaluable on-the-ground insights; you know who you are.

Thank you Banking Risk and Regulation, Farah Khalique and John Crowley for the opportunity to write this op-ed for the Financial Times! - What lessons do banks have to keep learning from physical events? - What can they change in their processes, their front-line-to-risk interactions, their leadership, their general approach? - What will bailouts look like a few risk events down the line and who will bear the cost? I'm grateful to my US network for your invaluable on-the-ground insights; you know who you are.

🔥 Amid the pain of the devastating Los Angeles wildfires, various forecasts of insurance and reinsurance losses are circling. Few analysts are venturing estimates on banking losses, but it would be a mistake to write these off as negligible. It would be a bigger mistake not to learn from them, writes Tina Mavraki CFA. 💰 The LA wildfires so far have inflicted damage of between $250bn and $275bn and wiped out around 12,000 structures, estimates AccuWeather. This represents about 6 per cent of California’s US$ 3.9tn GDP. 🏦 Granted, it takes a while for credit, income, and fee losses to feed through to banking financial accounts. Some losses are absorbed by state relief programmes — California already announced a $2.5bn package — while others are covered by insurance. Major lenders and state-chartered banks also are offering 90-day mortgage pay relief. 🏘️ Looking more closely at the built environment, however, insurance cover only extends to the value of rebuilding a structure. Additionally, banks count land value as part of their collateral, which is, say, around 30 per cent of the total property value. 📉 Land value has dropped considerably in deeply affected areas, and the probability and timing of recovery are highly uncertain, particularly if the 2018 California Camp Fire experience is anything to go by. 📊 Adding everything together, if mortgage cover is around 80 to 90 per cent of the estate value of a property, then expect loan-to-value cushions to have been completely purged and insurance cover to fall well short of banks’ marked collateral value. ⚠️ As a result, they should expect notable capital charges and provisions. https://lnkd.in/de3VwTEk

🚨 The UK’s National Crime Agency (NCA) is consulting on lowering the bar for reporting suspicious transactions just two years after it was last changed. A formal plan is in the works, writes Francesca Washtell. 📉 The minimum threshold for filing a Defence Against Money Laundering (DAML) request was increased to £1,000 from £250 in January 2023 to reduce the administrative burden on banks. DAML submissions had shot up from fewer than 35,000 between 2018 and 2019 to more than 83,000 three years later. 🔎 A DAML is a type of Suspicious Activity Report banks submit to the NCA for permission to process a potentially suspicious transaction without legal repercussions. ⚖️ However, some money laundering experts say the £1,000 minimum threshold still throws the net too wide, triggering unnecessary investigations into innocent customers. ⏳ Legitimate customers then face their transactions being blocked for days, or even weeks if the NCA refuses a DAML request. In some cases, people can be locked out of their accounts entirely. 📢 Kathryn Westmore, a senior research fellow at the Centre for Finance and Security (CFS) at RUSI, says: “One of the main problems that the UK has is that there are so many suspicious activity reports and DAMLs that go into the system that it’s entirely overwhelming for law enforcement.” 👀 Read more below. https://lnkd.in/e_UNPZAF