Consolidating Europe’s Solvency II insurance project into a single directive makes sense, but it means another delay in drafting the law. David Keefe reports

SINGAPORE – Regulators in Singapore have issued a consultation paper on phase 1 of their plans for implementing the international Basel II bank safety rules for banks incorporated in the city-state.

BASEL, Switzerland – Global banking regulators believe it’s neither necessary nor desirable to create an additional set of principles applying specifically to so-called low default portfolios within the framework of the Basel II bank safety rules.

JACKSON HOLE, Wyoming – The US central banking system’s supervision and regulation activities, along with its monetary policy and payments system operation, will have to keep responding to technological change, Federal Reserve Board chairman Alan Greenspan said in August.

Often controversial, Key Risk Indicators are a hot topic in op risk management. Will benchmarking fare better?

Europe’s big insurance project gets its second roadmap in four months amid little fuss.Getting it right is what counts, but patience isn’t inexhaustible. By David Keefe

British insurance industry representatives are pressing the case for a sophisticated risk-based approach in the Solvency II capital adequacy rules with the aid of a report suggesting risk diversification can reduce the capital requirements of general insurers by between 25% and 50%.

In a personal view, guest contributor Christoper Whalen says the US is much better prepared than Europe to handle the reality of implementing Basel II

Risk management systems and prudential rules are vitally important but they must be accompanied by a culture, set from the top, which espouses both the spirit and the letter of honest and prudent behaviour, Australia’s top financial regulator warned in June.

In the May issue, GRR reported the alarm of private German banks over amendments to the EU Capital Requirements Directive, which were claimed to give special privileges to savings and cooperative banks. Savings banks argued, however, that the amendments did no more than put them on a comparable basis to private banks. Under a compromise amendment, passed on July 13 by the Economic and Monetary Affairs Committee (ECON) of the European Parliament, the savings and cooperative banks will achieve the comparability they seek, if they meet certain criteria. Dr. Karl-Peter Schackmann-Fallis* lays out the savings banks’ case, below, and explains why the compromise amendment is a fair result.