Speaking to insurance company heads yesterday, Bank of England deputy governor, Paul Tucker, highlighted the potential for insurance firms to build \u201cshadow banks\u201d within
\ntheir groups, for example through their securities lending business.<\/p>\n
According to the deputy governor, \u201cnothing must be done to jeopardise the essential functions of securities lending\u201d which, he said, are key for any capital market to work efficiently.<\/p>\n
However, Mr Tucker noted the challenge which the maturity transformation and leverage involved in collateral swaps presents to regulators as they seek to enhance the resilience of the system, given the invisibility of the market.<\/p>\n
Addressing the need to put some structure around the market, and the Bank\u2019s desire \u201cin line with our traditions, to find market-led solutions where we can\u201d, he went on to suggest one option might be to introduce a Trade Repository.<\/p>\n
Mr Tucker also described the UK insurance industry as \u201csomething to be proud of\u201d regarding its role in enhancing efficiency and welfare.<\/p>\n
Reflecting on Solvency II, he said that the Bank and the Financial Services Authority were \u201cdismayed by how much it is costing the industry and the regulator\u201d.<\/p>\n
Mr Tucker summed up: \u201cWe need to be wary of regulators drowning in masses of data going beyond anything they can get their hands round. Unless we are careful, it risks distracting supervisors from the big risks.\u201d<\/p>\n
source: www.insurancedaily.co.uk<\/p>\n","protected":false},"excerpt":{"rendered":"
Speaking to insurance company heads yesterday, Bank of England deputy governor, Paul Tucker, highlighted the potential for insurance firms to…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"class_list":["post-206","post","type-post","status-publish","format-standard","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/206","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=206"}],"version-history":[{"count":0,"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/206\/revisions"}],"wp:attachment":[{"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=206"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=206"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sure2insure.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=206"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}