Foreign exchange
US regulators release details of Basel II qualification process
US financial regulators - including the Federal Reserve and the Office of the Comptroller of the Currency - have released preliminary details of the qualification process that financial institutions in that country will have to follow to implement the…
Emerging markets failing to plug into AMA
Many financial institutions in emerging markets are struggling with the demands of modern risk management. And difficulties with AMA aren’t helping. By Choongo Moonga
Private bankers buying more FX-linked structured products
Private bankers are buying an increasing number of structured products linked to currency movements in a bid to provide more attractive yields to their clients.
Collins Stewart merges G-7 currency options desks
Collins Stewart Tullett has merged the Group of Seven currency options desks of its Tullett Liberty and Prebon Yamane subsidiaries in London and Asia.
German banks get to grips with a new lending reality
Removal of state guarantees and pressure from shareholders for better returns means German banks can no longer churn out uneconomically priced loans to clients. Now they are starting to introduce sophisticated loan pricing systems, writes Duncan Wood
Below the radar
The upcoming Basel II capital Accord’s impact on the global banking industry is expected to be profound, and hardly painless. The Accord’s ramifications for the investment and hedge fund management sectors, while not nearly as obvious,could contribute…
Markit signs up 50th Red customer
Markit has signed its fiftieth customer to its reference entity database (Red) for credit instruments. The move means the St Albans-based company has signed up 35 additional clients to Red from its base of 15 institutions in January 2004.
IPE launches UK electricity baseload index
The International Petroleum Exchange (IPE) has launched a UK electricity baseload index in response, it said, to industry demand for a viable index on which to base physical deals. The first pricing period will be for the March 2005 contract.
Fitch/Algorithmics deal analysis
New York-based global ratings and risk management specialist Fitch Group has acquired Toronto-based enterprise risk management software supplier Algorithmics for $175 million.
From Basel II to Basel III
Financial institutions face major challenges in modelling credit portfolio risk, particularly in the field of CDOs. Walter Schulte-Herbrüggen and Gernot Becker argue that the main challenge will be in model testing, due to the increasingly customised…
A wrong-way bet
China Aviation Oil (CAO) revealed in late November that it had lost $550 million through trading oil derivatives – but not before its Chinese parent sold $108 million in CAO shares. By Nick Sawyer, with additional reporting by Jill Wong
DDQ re-issues commodity-linked structured product
Dawnay Day Quantum (DDQ), a division of London-based financial services and property investment company Dawnay Day, has re-issued its commodity-linked structured product aimed at both the institutional and retail markets.
Setting a timetable
Regulators in Australia and Japan are the latest to set deadlines for their banks to comply with Basel II, and both differ slightly from the Basel Committee’s schedule. Nick Sawyer reports
The importance of ALM
The crossfire between the International Accounting Standards Board and the European Commission seems to have left corporates bewildered about the implications of IAS 39. Risk talks to leading advisory groups and corporates about the challenges ahead, and…
Citibank cut out
The suspension of Citibank’s private banking business by the Financial Services Agency in September has brought to light a catalogue of internal control and governance failures within the bank’s Japanese operations. And with Citi now cut out of the…
BofA reports improved commodity-trading income
North Carolina-based Bank of America yesterday reported revenues of $45 million from commodity trading in its full-year 2004 results, up from a loss of $45 million for 2003. The investment bank's recovery came amid strong overall financial results for…
Mind your behaviour
Hedge fund managers are becoming interested in behavioural theory, anincreasingly influential branch of economics that describes the role of intuitivebias in investment decision-making. According to one finance professor,behaviouralism provides valuable…
The game of life
UK life insurers have faced a new regulatory regime in the aftermath of the guaranteed annuity options disaster, which has led them to rethink their use of derivatives. Nicholas Dunbar talks to four leading life companies
Reducing risk through insurance
In this article, Silke Brandts describes a general algorithm for quantifying the risk-mitigating impact of operational risk insurance. She then presents a simple haircut approach to incorporate residual risks inherent in the insurance contracts into the…
Structured finance ratings given BIS OK
The structured finance ratings business was given a clean bill of health today by the Bank for International Settlements (BIS), with a few caveats.
Icap buys out GovPX for $13 million
UK inter-dealer broker Icap is buying out the outstanding shares in GovPX, a US fixed-income and derivatives data provider, for $13 million, it was announced last week.
Mirant to pay $460m to settle California energy crisis claims
Bankrupt Atlanta-based energy marketer Mirant will pay $460 million to California power utilities and public agencies to resolve claims related to the state’s energy crisis in 2000 and 2001. The California utilities and agencies in the settlement were…
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Risk Management Inc signs four utility clients
Risk Management Inc (RMI), a Chicago-based energy consultancy and brokerage, has signed up four new utility customers for its energy risk management and hedging services. The City of Glendale Water & Power and Pasadena Water & Power, both in California,…