LONDON/WASHINGTON - Britain’s authorities are ready to trust their US counterparts and won’t seize the UK-based assets and capital of a US financial firm that runs into trouble if a joint plan to deal with failing cross-border institutions comes to fruition, a top UK central bank said as GRR went to press.

NEW YORK – It may yet become necessary to break up financial firms deemed too-big-to-fail (TBTF) if the present attempts to find a better way to deal with them are unsuccessful. But it is premature to give up on the current approach: changing the incentives facing large and complex firms, forcing them to become more resilient, and making the financial system more robust to their failure.

BASEL – Among the many arguments advanced by regulators for pressing on with implementation of the Basel III capital standard, a new one is emerging – to help combat fragmentation of the international banking system. This was an argument put forward in early November by Basel Committee secretary general Wayne Byres.

PARIS – Plans requiring French banks to separate their speculative trading activities from services supporting the economy seem likely to be far less radical than the ring-fencing regulations proposed by the US, Britain or the EU’s high-level Liikanen group.

LONDON – The successful launch of the world's first hybrid Tier 1 sukuk (Islamic bond) from Abu Dhabi Islamic Bank (ADIB) has blazed a trail for other banks in the Middle East and Asia that want to boost their capital to comply with the Basel III global standard. The unique structure of the ADIB’s early November issue means that it both conforms to the strict Basel III requirements and is a Shari’ah-compliant sukuk, according to experts.

BRUSSELS – The structural reforms of the EU banking sector proposed by a high level group, which reported in October, do not go far enough says Finance Watch, an independent public interest association, in a response to the recommendations. A thorough, precise and far reaching analysis of the issues is provided by the high level group, Finance Watch says, but its recommendations do not go as far as the diagnosis suggests is necessary.

LONDON - Canada’s Mark Carney, who in a surprise announcement in November was named as the next governor of the Bank of England, will remain chairman of the Financial Stability Board (FSB), the body charged with implementing the global financial reforms agreed by world leaders.

WASHINGTON – With the 2012 US presidential election concluded, the Senate in November confirmed Martin Gruenberg as chairman and Thomas Hoenig as vice chairman of the Federal Deposit Insurance Corporation (FDIC), the federal banking supervisory agency that insures customer deposits at America’s banks.

WASHINGTON – Audit firms that expand into businesses that have little to do with accounting’s primary purposes do little to promote audit quality or the independence of auditors, the top accountant at America’s stock market regulator warned in December.

AMSTERDAM – Central clearing is a systemically important activity and will become more so in the future, but the function is of crucial importance, according to a top Netherlands financial regulator.