june 16, 2011static.reuters.com/resources/media/editorial... · june 16, 2011 a spate of hacking...

JUNE 16, 2011

A spate of hacking attacks hit the IMF and several US government and financial institutions, triggering calls for global action against cyber-snooping. U.S. regulators delayed new rules on swaps regulation and introduced minimum capital standards for all U.S. banks. The U.K. backed plans to ring-fence banks' retail businesses from their investment banking activities to shield taxpayers from future crises, while France called for tighter controls on speculators blamed for spiraling food and energy prices.

TOP STORIES Cyber attacks boost calls for global action ...................................................................... 6 U.S. moves to delay swaps crackdown, bolster banks .................................................... 6 UK backs banks' shielding retail business from risky activities ..................................... 7 Sarkozy demands crackdown on commodity speculators .............................................. 7

FINANCIAL SERVICES

REGULATORY REFORM

U.S. regulators differ on bank capital impact ................................................................... 8 SEC moves to delay most security-based swaps rules ................................................... 8 Fed expanding capital tests for U.S. banks ...................................................................... 9 U.S. banks get more time to file foreclosure plans .......................................................... 9 SEC proposes post-Madoff broker oversight plan ......................................................... 10 UK gets ball rolling on new financial regulation laws .................................................... 10 UK's FSA says EU bonus curbs may need reforming .................................................... 10 UK warns EU against weakening Basel, bank tests ....................................................... 11 Swiss upper house debates big bank capital rules ........................................................ 11 Republicans seek economic analysis of Dodd-Frank .................................................... 12 China ups bank reserves ratio as inflation hits 34-month high ..................................... 12 HSBC wants broad UK ring-fence as debate heats up ................................................... 12 U.S. lawmakers seek reforms of anti-corruption rules ................................................... 13

ENFORCEMENT

U.S. phone taps convict three more of insider trading .................................................. 13 U.S. top court rules for Janus in securities case ........................................................... 14 SEC sides with Stanford victims on compensation ....................................................... 14 Setback for HK regulator in bid to ban Tiger Asia.......................................................... 14 JPMorgan to pay $27 million in auto lending settlement ............................................... 15 Ex-First Cash chairman charged with insider trades ..................................................... 15 Regions Financial bank in U.S. probes executives on bad loans .................................. 16 U.S. SEC may pursue fraud case against Goldman's Tourre ........................................ 16 Sen. Grassley criticizes SEC response to query ............................................................ 16 UK's FSA fines trader $1.1 million for market abuse ..................................................... 17 Former TBW execs get prison time for roles in fraud .................................................... 17 Goldman fined $10 million, to stop trading 'huddles' .................................................... 17 New York extends mortgage probe to trustees .............................................................. 18 UK extends insurance mis-selling settlement time ........................................................ 18 Lehman creditors pan disclosure proposal.................................................................... 19 Ambac, banks' $33 million settlement wins court OK .................................................... 19 CIBC World Markets to settle Canada regulator probe .................................................. 19 FINRA panel awards ex-Merrill Lynch staff $1.5 million ................................................ 19 Diageo close to settlement with U.S. SEC in bribery probe -report............................... 20 Siemens confirms corruption case in Kuwait ................................................................ 20

SUPERVISION

Regulatory clout won't ease credibility doubts .............................................................. 20 U.S. financial regulators face budget limits in House .................................................... 21 UK Treasury wants early advice on Lloyds sale –report ............................................... 21 IFR: Securitization industry seeks respectability in Brussels ....................................... 21 Bank of America hindered foreclosure review ............................................................... 22 Most Iraqi private banks hit capital target ...................................................................... 22 BoE's Haldane says FPC may target "shadow" banking -report ................................... 22 Czech central bank stress tests: banking sector resilient ............................................. 23 UK may intervene in exchange-traded funds sector ...................................................... 23 Brazil set to pass law speeding merger approvals ........................................................ 23 South Korea vetoes KDB bid for Woori, sale seen in doubt .......................................... 23

ACCOUNTING & FINANCIAL STANDARDS

U.S. SEC blocks private trade of 2 Chinese companies ................................................ 24 U.S. SEC warns investors on reverse merger companies ............................................. 24 Auditors face suits over U.S.-listed Chinese blowups ................................................... 24 Singapore wants top executives to vouch for company accounts................................ 25 Ernst & Young quits as Life Partners auditor ................................................................. 25

GOVERNANCE

U.S. judge: If incorporated in Delaware, litigate there.................................................... 26

DERIVATIVES

Swaps clearing could boost Treasuries, futures markets ............................................. 26 EU moving towards deal on derivatives crackdown ...................................................... 27 ISDA rules Allied Irish Banks has had credit event ........................................................ 27 CFTC plan on client margins sparks debate .................................................................. 27

EXCHANGES & TRADING PRACTICES

Maple says joining TMX, Alpha, CDS to help markets ................................................... 28 NYSE exec sees job losses after Deutsche Boerse merger .......................................... 29 NYSE extends LCH contract to buy time on deals ......................................................... 29

FUNDS MANAGEMENT

UK fund managers demand independent Keydata review ............................................. 29 UK's FSA warns wealth managers over investment risk ............................................... 30 South Korea revises regulations to allow homegrown hedge funds ............................ 30

FINANCIAL CRISIS & ECONOMY

U.S. debt talks set July 1 deadline for deal..................................................................... 31 BIS's chief: Policy mix needed for financial stability ..................................................... 31 Europe at mercy of rating agencies as reforms struggle............................................... 31 Liikanen: ECB should rethink collateral rules post-crisis ............................................. 32 ECB continually reviews collateral framework –Bini Smaghi ........................................ 32 Moody's puts French banks on review for downgrade over Greece ............................. 33 Nigeria central bank says rescued lenders in dire straits.............................................. 33

TAX

Swiss, U.S. in talks on tax probe settlement .................................................................. 33 Tanzania parliament backs mineral "super tax" plan..................................................... 34 Finance ministry proposes doubling Gazprom's extraction tax .................................... 34

CURRENCY

House Democrats push for vote on China currency ...................................................... 34 China cuts red tape for banks' currency conversions ................................................... 35 Iran to use "all tools" to stop currency slide .................................................................. 35

TRADE & CROSS BORDER

India seeks OECD help to bring back illicit funds .......................................................... 35 International banks seek licenses in Australia ............................................................... 36 WTO will strengthen EU claims on China export curbs -EU .......................................... 36 HSBC, Citi given nod to underwrite China corporate debt ............................................ 36 Massmart CEO "surprised" by government intervention -report .................................. 37

STATE ENTERPRISES

Investors could take stake in Amtrak under proposal ................................................... 37 Dutch government to privatise power, gas grid operators ............................................ 38

COMMODITIES & ENERGY

CFTC plan to curb commodity speculation not imminent ............................................. 38 Sarkozy urges G20 farm transparency deal ................................................................... 38 UK's OFT will not probe LME warehouse activity .......................................................... 39 IAEA states vow to boost nuclear regulators ................................................................. 39 Senator seeks price info on oil market from CFTC ........................................................ 39 Iran's NITC says secures new ship insurance cover ..................................................... 40 Manitoba to fight changes to Canadian Wheat Board .................................................... 40

TELECOMS & MEDIA

TELECOMS

French telecoms regulator opens 4G bidding ................................................................ 41 FCC Chairman wants industry to close broadband gap ................................................ 41

CYBER SECURITY

Senate, CIA websites attacked, hackers claim responsibility ....................................... 42 Citi says 360,000 customers hacked in May cyber attack.............................................. 42 Seoul launches cyber security plan; experts urge global response ............................. 42

PEOPLE Senator Shelby says supports FDIC nominee ................................................................ 44

COMING UP

"The only way to stop such attacks is 'naming and shaming', and in this case, unlike those of individual national governments, there is a clear global interest at stake."

Alexander Klimburg, a cyber-security specialist at the Austrian Institute for International Affairs on the hacking attempt against the IMF

"You don't have to be Inspector Clouseau to figure this out."

Larry Wortzel, a commissioner on the U.S.-China Economic and Security Review Commission, suspecting Chinese authorities were behind the IMF hacking in order to get inside information before meetings with French Finance Minister Christine Lagarde.

"This isn't what I asked for, and it's not an acceptable response. I'm looking for the SEC to explain how it handled specific referrals. Did the agency review them and find no credible evidence of wrongdoing? Or are they sitting in a drawer because the agency ignored them?"

Senator Charles Grassley, on the SEC's refusal to supply details of how it handled complaints about insider dealing at SAC Capital Advisors.

"It wasn't a problem of a lack of capital. It was a problem of a fundamental lack of trust. If you're honest about it, and I think we should be to the public, this law won't solve the problem."

Eugen David, of the Swiss Christian Democracts (CVP), commenting on Switzerland's proposed new capital rules and referring to the freeze of interbank lending after the collapse of Lehman Brothers.

"I believe it is a poor idea to have two one-club golfers; a single player with multiple clubs to choose from would be preferable."

Former Bank of England Monetary Policy Committee member Sushil Wadhwani, arguing that it would make more sense to hand stability powers to the MPC instead of the central bank's Financial Policy Committee.

"Even a short suspension of payments on principal or interest on the Treasury's debt obligations could cause severe disruptions in financial markets and the payments system."

Federal Reserve Chairman Ben Bernanke on the consequences of not reaching an agreement to raise the U.S. debt limit.

"All they're doing is saying 'Look how good we are'. These guys are literally in it for embarrassment, to say 'your security is crap.'"

Jeffrey Carr, author of the book Inside Cyber Warfare: Mapping the Cyber Underworld, on the attacks against the Senate and CIA websites by hacker group Lulz Security.

GLOBAL | REUTERS, JUNE 13-16

Governments, multinational corporations and global institutions are losing the battle against computer hackers, experts said. During the past week, the International Monetary Fund, the U.S. Senate, the CIA and Citi joined Sony and Google on a growing list of hacking victims. Cyber security experts said the only way to effectively combat the menace was for the public and private sectors to join forces and combine greater regulation with international action. U.S. Securities and Exchange Commission head Mary Schapiro said last week she will "seriously consider" issuing guidance outlining when public companies should disclose breaches. John Bassett, senior fellow for cyber security at London's Royal United Services Institute, said organisations were more aware and open about the attacks they face. Alexander Klimburg, a cyber-security specialist at the Austrian Institute for International Affairs, said the attempt to steal sensitive information from the IMF was a chance to launch a "communal" investigation into an attack on a communal institution. Experts said a national government was the most likely culprit in the IMF attack, given the complexity and its targeting of the organisation's secrets. For many, China topped the list of suspects. Beijing angrily denies any government link. But experts said almost every sophisticated state indulges in electronic snooping, whilst independent hackers potentially working for militant groups or even banks or investment funds could also be in the frame.

US | REUTERS, JUNE 14

In a move that will give the European Union time to catch up with the United States in regulating the $600-trillion swaps market, the U.S. Commodity Futures Trading Commission unanimously voted to delay so-called "self-executing" reforms in swaps rules until as late as Dec. 31. The agency plan would grant temporary relief from the new guidelines for certain transactions in exempt or excluded markets -- primarily in financial, energy and metals. It also would delay measures that do not require rule-making but refer to terms such as swap, swap dealer or major swap participants that still must be further defined by regulators. Delaying them would give "needed clarity for market participants" and address legal concerns, the CFTC said. Those rules that require rule-making and therefore do not go into effect on July 16 include defining a swap trade, clearing exemptions for companies that use swaps to hedge everyday business risks, real-time reporting of derivatives trades, and capital and margin requirements for trades. The proposal must be finalized by the commissioners, which they plan to do by July 16. The EU has trailed the United States in cracking down on commodities speculation and derivatives, prompting concern among policy-makers about an uneven pace of regulation. That concern would be somewhat relieved by the CFTC's action, as would worries among commodity and derivatives traders about complying with new U.S. rules. Separately, U.S. banking regulators approved a final Dodd-Frank rule requiring large banks to meet the same minimum capital standards as community banks. The Federal Deposit Insurance Corp approved the measure, which generally affects banks with more than $250 billion in assets. The rule will prevent large banks from using a system of risk measurements to determine that they can hold less capital than smaller federally insured depository institutions. Learn more

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UK | REUTERS, JUNE 15

Britain fired the starting gun on major reforms for its powerful banking sector, backing calls to shield banks' retail businesses from their investment banking activities to shield taxpayers from future crises. Finance minister George Osborne supported the UK Independent Commission on Banking's ring-fencing proposal in a move aimed at showing the public that the government was fulfilling a promise to be tough on the banks. The ring-fencing would set up safety barriers between retail and investment banking arms, while keeping the different divisions under the same parent holding company. Osborne also backed higher capital ratios for the banks. The reforms go further than measures in other countries, although the capital requirements are unlikely to be as tough as in Switzerland. The ICB has proposed that top UK retail banks hold a core tier one capital ratio of at least 10 percent. Under the plan domestic banking would become a low-risk utility service, while riskier investment banking will face higher funding costs, potentially forcing some companies to shrink or reshape. Osborne did not provide details of what assets should be ring-fenced, but he made clear that the separation should allow the retail arm to keep functioning if investment banking operations are wound down. Full details of the planned ring-fencing reforms and other proposals will not be released by the ICB until Sept. 12. UK banks have been lobbying the ICB to suggest a less capital-intensive bank structure. It is said to be warming to the idea of so-called "operational subsidiarisation" – which means banks would split their operations into separate legal entities. A separately-capitalised overarching company would then provide essential operational and funding services to individual businesses. The suggested minimum capital requirements for UK banks may be similar to those imposed on overseas rivals, as big global banks face a top-up requirement over the current 7 percent global minimum standard.

GLOBAL | REUTERS, JUNE 14-16

French President Nicolas Sarkozy called for tighter controls on speculators he blames for spiralling food and energy prices, spelling out reforms to put more trading under the thumb of regulators. Sarkozy, head of the G20 group of the world's leading economies, said he wants to see new rules requiring minimum cash deposits with a central authority for all commodities derivatives deals, not just those on formal exchanges as is the current practice. Sarkozy's proposals are designed to rally European Union support for a regulatory crackdown on speculation in commodities ranging from oil to grain ahead of a meeting of G20 farm ministers. He said all G20 countries should commit themselves to follow the US and EU forward on commodities regulation. His sweeping proposals would widen the scope for regulating commodities to include physical trading and over-the-counter deals, not just established futures markets that are currently the main focus, experts said. Sarkozy also proposed giving regulators the clout to stop market malpractice, allowing them to impose position limits that would cap the size of individual trades. He added that highly complex derivatives should be standardised, and listed on markets or platforms where they can be closely watched by regulators. He also said that regulating trade in raw materials derivatives should be extended and that France wanted a minimum cash deposit for such transactions. He said countries should encourage the standardisation of derivatives and their listing on regulated markets or platforms. He met some resistance: Canada's Finance Minister Jim Flaherty said the Canadian government was opposed to stronger regulation of commodities and "interference in the market". Also, Britain's farming minister, Jim Paice, told Reuters that Britain did not believe speculators have played a central role in creating volatility in food commodity markets, and said he saw little value in more regulation.


Top U.S. banking regulators have offered differing views on whether additional capital requirements for the largest U.S. banks could hurt the economy. Federal Reserve and Federal Deposit Insurance Corp officials have downplayed or dismissed banks' argument that the new standards they could face will cause them to lend less at a time when the U.S. economy needs a boost. Acting Comptroller of the Currency John Walsh, however, has expressed many of the concerns raised by large banks in recent weeks. Walsh told a congressional committee his agency supports requiring large banks to hold a "moderate" amount of additional capital. Earlier in June, Fed Governor Daniel Tarullo took this argument head on and dismissed it in a speech to the Peter G. Peterson Institute for International Economics. He said that if systemically important institutions find the additional capital requirement makes some lending unprofitable, that lending could be assumed by smaller banks that do not pose similar systemic risk and thus have lower capital requirements. His speech put bankers on edge, and they have been pushing hard on the capital issue since. FDIC Chairman Sheila Bair, however, said that the cost of higher capital requirements in terms of lost economic output is expected to be modest. She also said she was "very concerned" the European banking system had the potential to become a future source of financial instability. She said her deep concerns were based in part on the credit quality of some countries and banks' exposure to the system, and that European banks "continue to effectively set their own capital requirements using internal risk estimates, unconstrained by any objective hard limits." Bair contended representatives of some major European governments were going out of their way to express public misgivings about following through with higher capital standards. Separately, the Federal Reserve will push international regulators to adopt a comprehensive system for ensuring that new capital rules are implemented consistently across different countries, Fed Governor Daniel Tarullo said. The Fed will push a three-part plan for monitoring Basel III implementation, Tarullo said in testimony prepared for a House Financial Services Committee hearing. U.S. banks have in recent weeks raised concerns that capital standards that are part of the Basel III international agreement will not be enforced equally by all countries involved in the negotiations.


The U.S. Securities and Exchange Commission became the latest regulator running behind schedule to delay a host of new regulations overseeing the swaps market that were set to go into effect in July. The securities regulator said "substantially all" of the new requirements pertaining to security-based swaps will not go into effect on July 16 -- a rapidly approaching deadline that would have implemented parts of the Dodd-Frank financial reform bill enacted nearly a year ago. Robert Cook, director of the SEC's Division of Trading and Markets, said this was only the first step in a series of actions the SEC intended to take in coming days to address effective date

issues. The SEC said that after it had completed proposing all of the key rules required by Dodd-Frank it could ask the public to comment on a detailed implementation plan in order to minimize market disruptions and unnecessary costs.


The Federal Reserve will subject more banks to annual stress tests to determine whether they have enough capital and can raise their dividends. The Fed proposed that banks with $50 billion or more in assets be subjected to the capital testing regime, bringing the number of banks that would face annual tests, if they were conducted today, to 35 from a prior level of 19. Among the banks that would now fall under the testing regime, based on Fed data through March 31, are Northern Trust Corp, M&T Bank Corp, Discover Financial Services and Comerica Inc. The tests seek to determine how a large bank whose failure could hurt the economy and markets would weather a financial shock or an economic downturn. The Fed said the expanded capital tests are intended to complement the stress tests required by the Dodd-Frank Act. The amount of information banks would have to provide the Fed for the capital tests would depend on the size and complexity of the institution, the Fed said. The proposal will be out for comment through Aug. 5. At the same time, the Fed, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp issued proposed guidance for how banks with more than $10 billion in assets should develop a framework to test the resilience of their capital and liquidity. Learn more


U.S. regulators will give banks more time to comply with a crackdown on their mortgage servicing practices. The Office of the Comptroller of the Currency said it was extending by 30 days the time the banks have to file plans for how they will meet the requirements laid out in an agreement entered into on April 13 with the agency. The banks originally had 60 days to comply with the order. The OCC said the Justice Department had requested the delay, which would provide more time for it and state governments to advance their own negotiations with the banks to settle accusations of foreclosure shortcuts. The OCC, the Federal Reserve and the Office of Thrift Supervision announced on April 13 that 14 large housing lenders had agreed to overhaul their mortgage operations and compensate borrowers who were wrongly foreclosed upon. What fines the banks may have to pay has yet to be determined. In May 2011, the banks proposed a settlement figure of $5 billion, which was far below the $20 billion range the states and their partner federal agencies had discussed. Learn more

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U.S. securities brokers would be more closely scrutinized by auditors and be subject to stricter oversight of their handling of customers' assets under a new plan proposed by federal regulators. The proposal by the Securities and Exchange Commission is meant to improve oversight of broker-dealers in the wake of Bernard Madoff's massive Ponzi scheme. It is not one of the nearly 100 new rules required under the Dodd-Frank Wall Street overhaul law. However, it will help facilitate the Public Company Accounting Oversight Board's new powers under Dodd-Frank to oversee registered public accounting firms that audit broker-dealers. The proposal, which was put out for public comment, is meant to serve as a companion piece to regulations the SEC adopted in late 2009 that tightened custody rules for investment advisers and subjected some of them to surprise audits. The proposed rule also aims to better protect customer assets, particularly in cases where brokers have custody of them. Under the plan, the annual audits that brokers already face would be bolstered so auditors place a greater focus on custody activities. Brokers with custody of client funds would face examinations to make sure they are meeting customer protection and net capital rules. In addition to heightened auditing rules for brokers, the proposal would also subject brokerages to additional oversight by SEC and self-regulatory examiners. Learn more


Britain's overhaul of financial regulation began to work its way into law, with ministers keen to put in place a framework robust enough to avoid a repeat of the credit crisis. At the top of the agenda was the abolition of the city watchdog Financial Services Authority and the establishment of a Bank of England Financial Policy Committee, which met for the first time. The BoE will still be in charge of monetary policy, but also take over regulation of banks in the biggest shake-up of Britain's financial services framework since the previous Labour government came to power in 1997. The draft financial regulation bill, published on Thursday, June 16, will be open to pre-legislative scrutiny with a cross-party committee from both houses of parliament combing through the details. The changes should be written into law in 2012.


Europe's tough bonus curbs make it harder for banks to keep staff and how they are applied may need tweaking, Britain's Financial Services Authority said. The European Union introduced mandatory pay curbs from January 2011, which are more stringent than the looser "guidance" implemented in the rest of the world. This has caused difficulties for EU banks competing to recruit and retain staff in non-EU markets, the FSA said in its 2010-2011 annual report. It said it would consider ways in which it could mitigate "adverse competitive implications for firms within the limitations imposed by (EU rules)". The FSA also said Britain's stock market is getting "cleaner" with fewer unexplained share price moves two days before merger announcements, a pointer to potential insider trading. A fifth of merger announcements -- 21.2 percent -- are still preceded by unexplained price moves, although they are at their lowest since 2003 and down from 30.6 percent in 2009.

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The FSA said it would publish its first public consultation in 2011 on how banks must have a resolution plan or "living will" that will be triggered if a bank fails to meet capital rules. The watchdog also said it would align its twice-yearly survey of hedge fund activities with surveys planned by the U.S. Securities and Exchange Commission and international regulators. Learn more

UK | REUTERS, JUNE 14-15

Tougher new global bank capital rules must be implemented in full in the European Union and the bloc's banking health check must not be diluted, Britain's financial services minister said. Mark Hoban told the Chartered Institute for Securities and Investment conference that it was in no one's interest to undermine the stress test by watering them down. The European Banking Authority is completing the stress test with results due in early July 2011, in a bid to restore confidence in the banking sector after last year's health check flopped. This year's stress test had to be different, Hoban said. A robust, credible exercise would help to restore confidence in the banking sector and Britain welcomed the strong review of the results and the pass mark set, he added. He warned the EU should implement Basel III in a way that sets "a floor and not a ceiling", noting concerns the EU will seek to make the new rules a ceiling in the 27-nation bloc rather than a minimum standard a member state can require banks to increase. Bank of England Governor Mervyn King chimed in, warning the European Union against watering down Basel III and saying Britain should be free to regulate its banks as it sees fit. In an address to the City of London's financial elite, he dismissed suggestions that the central bank's' new risk regulator would simply implement EU recommendations and suggested it could take a tougher line. King said it would be "misguided" for the EU Capital Requirements Directive to prevent member countries from imposing higher capital requirements to protect the interests of domestic taxpayers. Likewise, European legislation should also not try to prevent the BoE's Financial Policy Committee "from varying macro-prudential instruments, including capital ratios and risk weights, as appropriate to national circumstances", he said. King said all banks, especially systemically important ones, would need to have much higher levels of loss-absorbing capital than before the crisis, and this ideally should be common equity. He expressed concerns that the European Commission would propose a weakening of the Basel standards in that area.

SWITZERLAND | REUTERS, JUNE 14

The Swiss upper house of parliament postponed voting on a law that if passed would force UBS and Credit Suisse to hold more capital than global rules demand. During a debate parliamentarians generally spoke in favour of the measure, which would force the two banks to hold equity Tier 1 capital of at least 10 percent, compared with 7 percent under new Basel III industry rules. But, the upper house delayed voting until later in the week, due to differences among parliamentarians on various technical points. However, they voted in favour of an assurance by Finance Minister Eveline Widmer-Schlumpf that the capital requirement would not be even higher than 19 percent because of the way subsidiaries are treated. Switzerland has been weighing tough big bank capital standards after the state had to bail out UBS during the financial crisis. The upper house is expected to support the measure after one of its commissions backed an amended proposal in May. The legislation could, however, still be

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delayed or watered down as the lower house is not due to vote on the proposal until September, just before national elections in October. Both UBS and the powerful right-wing Swiss People's Party (SVP) have warned the plan would make big Swiss banks less competitive than their foreign rivals, and critics have also said it could raise the cost of domestic lending. But many parliamentarians who addressed the session wanted the tougher capital standards to go ahead. Swiss National Bank Chairman Philipp Hildebrand said requiring big banks to adhere to tough capital standards will not damage the Swiss economy.


Republicans on the U.S. Senate Banking Committee will examine whether regulators are doing enough to analyze the economic impact of dozens of financial reforms. Chairman Richard Shelby and nine other Republicans said they would conduct "in-depth briefings" with the internal watchdogs of the Commodity Futures Trading Commission, the Securities and Exchange Commission, the Federal Reserve and other regulators, the Republicans on the committee said in a statement. The Republicans' call for the review comes days after JPMorgan Chase Chief Executive Jamie Dimon publicly challenged Fed Chairman Ben Bernanke on the issue earlier in June.

CHINA | REUTERS, JUNE 14

China's central bank raised bank reserve ratios for the ninth time since October 2010 to try to curb inflation, which is running at its fastest pace in almost three years. The 50 basis-point increase in the reserve ratio requirement (RRR) means that big banks have to put aside 21.5 percent of their deposits, a record high, locking up funds that could otherwise be loaned out and so fuel inflation. The central bank move came just hours after data showed that consumer inflation, largely fuelled by high food prices, rose in May to 5.5 percent, a 34-month high. Even when food prices are stripped out, inflation was 2.9 percent, the highest level since records began in 2002 and a sign that price pressures are spreading in the economy. While the RRR increase was the ninth since October, the central bank has also raised interest rates four times over the same period to try to achieve average inflation in 2011 of 4 percent. Many analysts doubt that target can be achieved with average inflation in the first five months of 2011 already running at 5.2 percent.


HSBC wants all banking book assets to be included in a "ring-fence" that is proposed as a way to make the British banking system safer, representing a far bigger pool of protected assets than rivals want. HSBC said assets in the banking book, which are held to maturity, should be held within the ring-fence, which would mean mortgages, corporate loans and all long-term assets on the balance sheet protected by a government guarantee. Trading book assets, which are marked to market prices, would be kept outside the ring-fence, leaving banks to independently fund them via wholesale markets. The probable outcome under such a regime would be separation closer to a Glass-Steagall type of basis, HSBC said in a written submission to lawmakers, referring to the U.S. legislation of

1933 that split investment banking and commercial banking. It said this would have "certain inefficiencies" but would be preferable to a structure that risked separating funding from lending.


The Obama administration defended its stepped up enforcement of a U.S. law banning bribery of foreign officials, and warned lawmakers that changes could open loopholes for wrongdoers. Greg Andres, deputy assistant attorney general in the Justice Department's criminal division, told the House Judiciary Committee's subcommittee on crime, terrorism and homeland security that foreign corruption remained a "problem of significant magnitude". Tougher enforcement of the Foreign Corrupt Practices Act by the Justice Department and the Securities and Exchange Commission has raised U.S. business concern over its impact. U.S. government officials are worried that amending the law could signal a weakening of Washington's commitment to prosecuting bribery cases. Representative James Sensenbrenner, the Wisconsin Republican who chairs the panel, said lawmakers were drafting a bill that would more clearly state "the rules of the road" associated with the 34-year-old FCPA. He said the law needed to be brought up to date, noting concerns that the law was being enforced in a "vague and impenetrable manner," putting U.S. companies at a disadvantage compared to Chinese companies that did not have to comply with such strict laws. He noted that most U.S. companies opted to settle bribery cases rather than letting them go to trial, which meant there were few rulings that could help define the limits of the law. Former Attorney General Michael Mukasey, who was hired in March 2011 to lobby for reforms of the law, presented six specific reforms. He said his top priority was adding a "compliance defense" to the law, which would allow companies to rebut criminal liability if the offending individual had circumvented the company's compliance measures, adding the provision would encourage companies to set up their own compliance programs.


Three former securities traders were convicted on all counts of fraud and conspiracy to commit insider trading on pending mergers, in another victory for prosecutors in their probe of suspicious trading on Wall Street. Brothers Zvi Goffer and Emanuel Goffer and a third trader, Michael Kimelman, their former partner at trading firm Incremental Capital LLC, chose to go to trial when dozens of other defendants in the broad probe have pleaded guilty. A jury convicted Zvi Goffer, 34, a former Galleon Group trader, of two counts of conspiracy and 12 counts of securities fraud for activities between 2007 and 2009. Prosecutors said he was a ringleader who paid tens of thousands of dollars in bribes to two Ropes & Gray lawyers to learn what corporate deals the law firm was working on. The lawyers, Arthur Cutillo and Brien Santarlas, have pleaded guilty to criminal charges. Emanuel Goffer, 32, was convicted on one conspiracy charge and two securities fraud counts. Kimelman, 40, was found guilty of conspiracy and two counts of securities fraud. Kimelman had rejected a plea deal soon before the trial began on May 16.

The judge set Zvi Goffer's sentencing for Sept. 21. The other two men will be sentenced on Oct. 7. The three were expected to appeal their convictions, which carry a maximum possible prison sentence of 25 years for each man. All three are free on bail pending sentencing.


Janus Capital Group Inc and a subsidiary cannot be held liable in a lawsuit by shareholders over allegedly false statements in prospectuses for several Janus mutual funds, the U.S. Supreme Court ruled. By a 5-4 vote in a narrow decision, the justices overturned a ruling by a U.S. appeals court that a class-action securities fraud lawsuit could go forward. In backing the Denver-based Janus, one of the largest mutual fund companies, the high court's decision will mean few changes for the way big asset managers govern themselves -- structures that could have faced a major overhaul if the ruling had gone the other way. Janus, in appealing to the Supreme Court, argued that the funds were separate legal entities and that neither the parent company nor its subsidiary was responsible for the prospectuses and could not be held liable. The high court agreed. It ruled the alleged false statements in the prospectuses were made by an investment fund, not Janus Capital, and that Janus and the subsidiary therefore cannot be held liable in a private securities fraud lawsuit. The lawsuit was brought on behalf of those who bought Janus stock from mid-2000 through early September 2003. It alleged that the prospectuses of several Janus funds created the false or misleading impression that the company would adopt measures to curb market timing -- when in fact secret arrangements with several hedge funds permitted such transactions, to the detriment of long-term investors. The lawsuit alleged that Janus stock was purchased at inflated prices, until public disclosure of the arrangements. Janus paid $225 million in 2004 to settle claims by regulators that it had failed to disclose the trading arrangements to long-term investors.


In a major victory for victims of Allen Stanford's alleged Ponzi scheme, U.S. regulators have concluded that they should be compensated by a brokerage industry-backed fund. The decision by the U.S. Securities and Exchange Commission comes nearly two years after the Securities Investor Protection Corp, which handles claims for investors if their brokerage firm fails, said it did not believe the victims were eligible to file claims. In its decision, the SEC said people who invested money through Stanford's U.S. brokerage arm, Stanford Group Co, were entitled to protection by SIPC. The SEC said it would ask SIPC to institute a liquidation proceeding against the brokerage, and file a court action to compel SIPC to do so if it refuses. The SEC's move decision prompted Senator David Vitter to reverse his decision to block the U.S. Senate from voting on two SEC commissioner nominees -- a Democrat, Luis Aguilar, and a Republican, Daniel Gallagher. He had earlier threatened to block their nominations unless the SEC came to a decision on behalf of the Stanford investors.

HONG KONG | REUTERS, JUNE 15

Hong Kong's securities regulator suffered a setback in its attempts to ban New York-based hedge fund Tiger Asia when a judge signalled it was beyond the High Court's jurisdiction to act in

a case brought by the Securities and Futures Commission (SFC) against the Julian Robertson-seeded fund. The SFC, which has accused Tiger Asia of insider dealing, is trying to ban it from trading securities or derivatives in the city and freeze some of its assets. The SFC has been unable to bring a criminal charge against Tiger Asia because its staff are based outside Hong Kong, so it is pursuing a civil case under the Securities and Futures Ordinance. The Hong Kong Court has yet to release its final decision over Tiger Asia but Justice Harris indicated in a separate case that the court had no jurisdiction to make a ruling, the SFC said. The judge was ruling in a separate case about whether the SFC could freeze the assets of Hontex, a company alleged to have disclosed materially misleading information to investors in its IPO prospectus. The SFC said that it does believe that such an order can be imposed and said it looked forward to the full judgement being released so it can make a full appeal. Learn more


JPMorgan Chase & Co has agreed to pay $27 million to settle U.S. allegations that the bank's auto lending unit used high-pressure sales tactics and false statements to sell products. The bank will pay a $2 million fine to the Office of the Comptroller of the Currency and distribute $25 million to customers who were misled, the Comptroller's office said in a statement. From January 2008 through May 2009, JPMorgan Chase sold products that would allow a customer to cancel or suspend payments on their auto loan if certain triggers were met. Often, events like death or unemployment trigger these kinds of products, and borrowers pay a monthly fee for them. JPMorgan Chase's sales staff made false and misleading statements when selling these products, often working off a script that the bank provided them, the OCC alleged. The script included rebuttals for when customers balked at the product. In 2009, the bank stopped marketing these types of products to customers. The OCC, part of the U.S. Treasury, said its probe prompted JPMorgan Chase to also review sales practices for home lending and credit card services, where the bank found additional practices to correct. Learn more


A former First Cash Financial Services Inc chairman was charged with insider trading for buying shares of the payday lender after learning it would buy back some of its stock. The U.S. Securities and Exchange Commission said Phillip "Rick" Powell, 60, had told his broker on March 11, 2008, to buy 100,000 First Cash shares after learning the company would begin the buyback the following day. It said these purchases caused First Cash to overpay $36,000 for its stock and gave Powell an illegal $124,000 profit.

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Regions Financial Corp's board is investigating if executives delayed public disclosure of loans that were going bad during the financial crisis, according to documents filed in a federal district court. The bank's audit committee began the probe after the Federal Reserve expressed concern about past practices at Regions, plaintiffs said in documents filed on June 7 in connection with a 2010 investor lawsuit against the bank. The lawsuit -- filed by a pension fund investor -- alleges senior Regions executives violated U.S. securities laws by misrepresenting the bank's financial condition in 2008 and 2009. According to the court documents, Regions' audit committee has hired New York-based law firm Sullivan & Cromwell to aid in the investigation. The law firm has a list of $150 million in assets that were removed from the bank's problem loan list in March 2009, the documents said. Investigators are looking at so-called extend-and-pretend cases, where a bank gives a borrower more time and delays reclassifying a souring loan, according to the documents.


The top U.S. securities regulator can pursue its high-profile civil fraud lawsuit against a Goldman Sachs Group Inc vice president over a product linked to subprime mortgages, a federal judge ruled. U.S. District Judge Barbara Jones rejected the request by the executive, Fabrice Tourre, to dismiss U.S. Securities and Exchange Commission claims accusing him of violating a federal law designed to stop the fraudulent sale of securities. But she dismissed some SEC claims, citing a recent U.S. Supreme Court ruling limiting the reach of federal securities laws. The SEC sued Goldman and Tourre in April 2010, accusing them of failing to tell investors the Paulson & Co hedge fund, run by billionaire John Paulson, helped choose and bet against the subprime residential mortgage-backed securities underlying Abacus 2007-AC1, a collateralized debt obligation. Goldman settled with the SEC last July for $550 million without admitting wrongdoing, but remains the subject of many lawsuits by investors who say the Wall Street bank's actions and the resulting negative publicity depressed its share price. Tourre is the only individual sued in the case. Jones said that, by alleging Tourre was "principally responsible" for Abacus and its marketing materials, the SEC sufficiently alleged he violated the law barring fraudulent sales "when Goldman's structured product syndicate desk invited institutional investors to contact Goldman's sales representatives in New York regarding Abacus." She also said Tourre must face SEC claims he misled ACA Capital Holdings Inc, which helped Paulson choose securities backing Abacus and sold protection against their default, by failing to reveal Paulson was betting against the debt. ACA had also bought $42 million of Abacus notes.


The Securities and Exchange Commission declined to detail how it handled complaints about SAC Capital Advisors, infuriating Sen. Charles Grassley who is looking into the agency's response to tips about possible wrongdoing. Republican Grassley has been using SAC Capital as a case study of how the SEC handles insider trading investigations and referrals from other regulators who spot irregularities, according to his staff. Grassley had written the SEC to ask what it did about referrals by the independent securities regulator Financial Industry Regulatory Authority, which had indicated there were suspicious trades by SAC Capital. The SEC's enforcement director, Robert Khuzami, wrote Grassley in

response that he was willing to describe how the agency's investigative process went generally but could go no further. Grassley was outraged.


Self-employed trader Barnett Michael Alexander has been fined 700,000 pounds ($1.15 million) for manipulating share prices in the latest crackdown on market abuse by Britain's Financial Services Authority (FSA). Alexander was also ordered to pay about 323,000 pounds to firms that suffered losses as a result of his actions, with UK spread-betting company City Index Ltd receiving the most compensation of just over 300,000 pounds. The FSA's acting director of enforcement and financial crime, Tracey McDermott, said he had sought to conceal his trading and made substantial profits at the expense of the firms he traded with. However Alexander, an experienced trader and former private client stockbroker, said he had been unaware he had breached rules when dealing in shares and retail derivative products -- and he called on the regulator to clarify its guidelines. He said he had come up with what he believed to be a legitimate strategy, where he could arbitrage the price volume on the LSE against the spread-betting firms. The FSA, however, said he entered multiple small orders to buy and sell shares to manipulate the price of contracts for differences (CFDs) and spread bets and that he frequently used accounts in the names of third parties to disguise his behaviour. Learn more


Two former senior Taylor, Bean & Whitaker Mortgage Corp executives were sentenced to several years in prison for their roles in a nearly $3 billion fraud that took down the big lender and a major bank. The fraud ran more than seven years until August 2009 when TBW collapsed after the the U.S. housing market imploded, taking Colonial BancGroup Inc's Colonial Bank with it and putting hundreds of people at the firm out of work. Company and bank officials were accused of trying to cover up enormous losses by moving money between accounts at Colonial Bank and selling mortgage loans that did not exist, were worthless or already had been sold. The Obama administration elicited guilty pleas from six senior executives. TBW's former chairman, Lee Farkas, was convicted by a jury in April on 14 counts of bank, securities and wire fraud as well as conspiracy. Desiree Brown, TBW's former treasurer, was sentenced by District Judge Leonie Brinkema to six years in prison after she tearfully acknowledged her wrongdoing. She pleaded to one count of conspiracy to commit bank, wire and securities fraud. Brinkema also sentenced TBW's former president, Raymond Bowman, to 30 months in prison. He had pleaded guilty to a conspiracy fraud charge as well as for lying to investigators when they raided the mortgage firm two years ago. Farkas is due to be sentenced on June 27.


Goldman Sachs Group Inc agreed to pay a $10 million fine and stop giving favored clients trading ideas developed at internal gatherings known as "trading huddles." The accord with

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Massachusetts' securities regulator resolves charges that Goldman analysts gave "priority" clients, including hedge funds that trade rapidly, short-term trading tips that might be at odds with the bank's published research, violating state law. William Galvin, Massachusetts' Secretary of the Commonwealth, said that certain customers were given preference over other customers and that this was unethical behaviour. He said this was a recurring theme in the securities industry, "where some customers get special inside information and others do not." Stephen Cohen, a Goldman spokesman said the bank is pleased to settle the matter, which includes no admission of fraud.


New York's top legal officer is seeking information from Deutsche Bank AG and Bank of New York Mellon about their role as trustees for mortgage-backed securities, in an expansion of his probe of mortgage practices, said a person familiar with the matter. New York Attorney General Eric Schneiderman's office is examining whether the banks fulfilled their administrative duties owed to investors set out in agreements that pool mortgages into securities, according to the source. The New York Times first reported the inquiry into the role of the trustees. The newspaper also said New York's Schneiderman had teamed with Joseph Biden III, his counterpart in Delaware. Roughly 80 percent of mortgage securitization trusts are governed by New York law, which puts Schneiderman's office in a strong position to investigate the deals, according to the person familiar with the probe. The other 20 percent is governed by Delaware law, this person said. Schneiderman's office may end up working with Biden on the inquiry into the trustees, this person said. The inquiry into the role of the trustees is part of a larger investigation led by Schneiderman's office, which has sought information about securitization operations from seven banks and requested meetings with their representatives. It has also sent subpoenas to four mortgage-bond insurers.


Britain's financial regulator extended the amount of time top banks have to settle claims over a multi-billion-pound insurance mis-selling scandal, as Barclays promised to fully compensate thousands of customers. Barclays said it would settle tens of thousands of outstanding claims over the payment protection insurance (PPI) policies, putting pressure on rivals to follow suit. Britain's Financial Services Authority said it would extend the timeframe for banks to deal with claims that had been put on hold, beyond the eight weeks they have in the past been allowed. Barclays, which estimated it would take a 1 billion compensation charge, said all customers who had made a complaint by April 20 -- when banks lost a key court ruling -- would get an offer to settle their complaint in full, and receive annual interest of 8 percent. The bank said it will work to clear the backlog of more recent claims. Learn more

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Creditors of Lehman Brothers Holdings Inc, including units of Bank of America Corp and Barclays PLC, are blasting attempts by Lehman bondholders to force them to reveal details about their claims against the failed bank. At least 15 parties, including the official creditors' committee, filed objections in U.S. Bankruptcy Court in Manhattan, saying the bondholders' proposal would far exceed bankruptcy rule requirements. The bondholders, an ad hoc group led by hedge fund Paulson & Co, proposed forcing any party seeking to influence the outcome of Lehman's bankruptcy to reveal the nature of its claims, including the price paid to acquire those claims. Such a proposal would burden "virtually any party involved" in the bankruptcy with "unprecedented disclosure obligations," Barclays Capital Inc said in its objection. Bank of America dismissed the proposal as a "litigation tactic" in its court filing, saying the move is designed to discourage creditors from seeking a say in Lehman's repayment process.


A judge granted preliminary approval for Ambac Financial Group Inc, insurers and some banks to pay $33 million to investors to settle litigation accusing the bond insurer of hiding the risks it took on by guaranteeing risky mortgage debt. U.S. District Judge Naomi Reice Buchwald in Manhattan called the two settlements reached in May 2011 "fair, reasonable and adequate." She said she would consider final approval at a later date. One accord calls for Ambac to pay $2.5 million already held in escrow, and insurers for its officers and directors to pay $24.6 million. The other accord calls for seven banks that underwrote Ambac debt to pay $5.9 million. Once the nation's second-largest bond insurer, Ambac filed for bankruptcy protection from creditors in November 2010.

CANADA | REUTERS, JUNE 14

CIBC World Markets has agreed to settle a two-year investigation by Canadian market regulators into a violation of an options-contracts rule, by paying $95,000 in fines and costs. CIBC World Markets, the investment banking arm of the Canadian Imperial Bank of Commerce, admitted that it did not set up enough internal controls to ensure a particular change in the method to adjust options contracts was implemented on the system it used to monitor client margin requirements.


An arbitration panel of the Financial Industry Regulatory Authority (FINRA) ruled in favour of former Merill Lynch employee Angel Aquino and asked the investment bank to pay $1.5 million in compensatory damages. Merill Lynch filed the case against respondent Angel Aquino, accusing him of breach of promissory note and unjust enrichment. However, FINRA found the bank liable and asked it to replace the line from Aquino's form U5, saying "Mr. Aquino was terminated not for cause."


Diageo, the world's largest spirits group, is close to a settlement with the U.S. Securities and Exchange Commission to end a long-running bribery investigation, the Financial Times reported. The settlement talks are at an advanced stage and the British maker of Smirnoff vodka, Captain Morgan rum and Guinness beer has agreed to pay between $10 million and $20 million, the paper reported citing people familiar with the matter. The U.S. Department of Justice is not part of the settlement, the financial daily said.

MIDDLE EAST | REUTERS, JUNE 10

Siemens said it had discovered evidence of corruption at its business in Kuwait and had involved authorities. German daily newspaper Financial Times Deutschland earlier cited a senior prosecutor in Munich as saying arrests had been made in connection with a fresh investigation at Siemens. The paper cited judicial sources as saying at least two managers had been arrested, and an arrest warrant has been issued for a third manager who had worked in Kuwait.


New regulatory powers look set to give the Bank of England more clout than any other major central bank, but concerns are growing that it has bitten off more than it can chew. Britain's central bank is already struggling to fulfill its price stability mandate so it may seem an odd time to be expanding its responsibilities. The BoE's new risk watchdog, the Financial Policy Committee, was to l hold its first formal meeting on Thursday, June 16. It will discuss where trouble might be brewing for the financial system and what needs to be done about it. The watchdog's toolkit has yet to be formalised but is likely to include the power to demand tougher lending restrictions and higher bank capital requirements if it feels a bubble may be forming. Under the government's proposals, Bank of England (BoE) Governor Mervyn King will chair both the new systemic risk committee, which will meet at least quarterly, and the existing Monetary Policy Committee (MPC) which meets monthly to set interest rates. Legislation for the new framework will not be completed until late 2012, but questions are already being asked about how King -- and the three other MPC members who will sit on the FPC -- will manage their expanded workload.


The U.S. Securities and Exchange Commission would be denied a major funding increase for the 2012 fiscal year under a bill released by the House Appropriations Committee. The Republican-led committee's bill would also strip the newly-created consumer financial watchdog of its independent funding, subjecting it to the politically charged annual budget process starting in 2013. The committee said in a statement that the new agency had not yet been fully constituted and that many questions remained over its authority and mission. The new Consumer Financial Protection Bureau will open its doors in July and under the Dodd-Frank law it will receive funding directly from the Federal Reserve. Republicans have complained this will limit the ability of Congress to oversee the bureau. The new spending legislation would limit the amount the bureau could receive from the Fed in 2012 to $200 million. The Obama administration officials setting up the bureau estimated in February 2011 that the new agency would need a budget of $329 million in fiscal 2012. The funding for the SEC would be kept steady at $1.2 billion for the fiscal year that starts Oct. 1, according to the bill. The Obama administration had asked for a $222 million bump in funding for the agency.


Britain's finance ministry wants advance knowledge of how many bank branches state-owned Lloyds Banking Group should sell to boost competition, the Sunday Telegraph reported. Citing senior Treasury sources, the newspaper said that the finance ministry wants the Independent Commission on Banking, which was set up last June, to tell ministers how many branches should be sold before the ICB publishes its report in September. The move, thought to be the Treasury's first intervention since establishing the independent commission, would allow potential buyers to be sounded out, and would mean any extra branches could be wrapped into the existing process, the newspaper said. The Sunday Telegraph said investment bankers were putting the final touches to sale documents for the 632 branches that would go to 10 potential bidders. These included an unnamed Japanese bank and other Asian banks -- as well as other bidders who have made their interest more clear, such as Virgin Money, new venture NBNK and National Australia Bank.

EU | IFR, JUNE 14

Securitisation needs to be viewed as one instrument among others to fund the real economy, rather than as the "evil sibling," delegates at the Global ABS conference heard. Four years after the collapse of the market, securitisation professionals have adopted a low profile. But Rick Watson, managing director at the Association of Financial Markets in Europe, one of the organisers, said that the market is undoubtedly on the mend. Even if issuance is not back to pre-crisis levels and some players remain on the sidelines, the message must be that "Europe is different", Watson said, in reference to the US, which gave securitisation a bad name with its sub-prime mortgages and ninja loans. Mark Lewis, chairman of AFME/ESF, told delegates that the industry was "older and wiser". He made several references in his address to the need for securitisation to fund the "real European economy", in contrast with the more traditional emphasis placed on financial innovation and

clever structuring. But he also made a point that the playing field with other funding tools should be level. Securitisation professionals have probably managed to convince regulators and policy-makers that the ABS products were not "toxic" by definition and the bulk of the bonds issued in Europe are sound. As Kevin Ingram, a partner at Clifford Chance put it, securitisation may not be viewed as the "evil sibling" any more, but the amount of regulation needed remains an open question.


Bank of America Corp unnecessarily burdened U.S. regulators who were reviewing the mortgage giant's foreclosure practices, according to a court filing. The U.S. Department of Housing and Urban Development inspector general's office in 2010 conducted a review of the five largest mortgage servicers, including Bank of America, which is the biggest. Departmental auditor William Nixon said BofA "significantly hindered" the review, according to a document filed in a lawsuit brought by the State of Arizona against the bank. BofA was slow to provide documents and other information, Nixon said in a sworn declaration dated June 1, 2011. He also said that when interviews were permitted, the presence of the bank's attorneys limited the effectiveness of those interviews. A BofA spokesman said any suggestion that the bank had not fully cooperated was inaccurate.

IRAQ | REUTERS, JUNE 14

Most of Iraq's private banks have reached the central bank's $85 million capital requirement level aimed at diversifying the financial sector's activities, the head of a private banking association said. Abdul-Aziz Hassoun, executive director of the Iraqi Private Banks League, an independent organisation to support private banks, said 22 banks had so far reached the $85 million target. He said another three banks were in talks to merge in order to reach the required level. The country's central bank laid out a three-stage programme in 2009 for banks to raise their capital. The deadline for the first stage is end-June 2011, when banks should reach capital levels of 100 billion Iraqi dinar ($85 million). By June 2012, banks need to boost capital to $128 million and the third stage is for June 2013, by which time capital levels need to be at $213 million. Only seven banks have not undertaken increasing their capital and they have to explain this to the central bank, he said, adding that the central bank may withdraw the licences of banks that fail to meet the target.


The Bank of England's Financial Policy Committee could target the "shadow" banking system in its efforts to prevent future financial crises, central bank official Andrew Haldane was quoted as saying. The FPC could ask the government to expand its powers if it found evidence of "banking-type activities" in the unregulated system, Haldane, the central bank's executive director for financial stability and a member of the panel, said in an interview with Bloomberg. An interim version of the FPC met formally for the first time on Thursday, June 16, and the committee's initial job will be to recommend to the government what permanent powers they should have to forestall future financial crises. The committee has yet to specify what tools it will use to stop British markets from overheating.

CZECH REPUBLIC | REUTERS, JUNE 14

The Czech banking sector is resilient to a wide range of risks and its capital adequacy would stay above the regulatory 8 percent threshold in all assumed scenarios, the Czech central bank said. But in the worst assumed scenario under stress tests, eleven banks would require a capital injection of 17 billion crowns ($1.01 billion), or 0.5 percent of gross domestic product (GDP). In that scenario, the entire financial sector would need a 25.7 billion crown capital hike, which is 0.70 percent of GDP.


Britain's markets watchdog said it had concerns about exchange-traded funds and may intervene in the sector. Financial Services Authority director of conduct policy Sheila Nicoll said the FSA was looking closely at the sector and shared many of the concerns that had been highlighted. Nicoll told a Chartered Institute for Securities and Investment conference that she was concerned whether marketing and promotional material adequately explained differences between various types of ETFs.

BRAZIL | REUTERS, JUNE 14

Brazilian lawmakers could resolve one of the biggest barriers to corporate mergers soon, as they are expected to pass a measure that could dramatically shorten the time needed to approve deals. A bill before the lower house is aimed at preventing a repeat of confusing and expensive delays like the one plaguing Brasil Foods, whose future is in doubt because the Cade antitrust agency is still debating whether to approve the merger that formed the company two years ago. Under the current system, companies cannot consult with Cade before announcing a deal, which bankers say is a major deterrent to mergers in Brazil. The bill would allow such informal consultations, which Cade President Fernando de Magalhaes Furlan says are common in the United States and Europe. It would also limit the approval process to 330 days.

SOUTH KOREA | REUTERS, JUNE 14

South Korea vetoed a move by state-run KDB Financial Group to buy Woori Finance Holdings Co Ltd, responding to concerns about market dominance and threatening to derail the $6 billion auction. The decision raises the odds of another delay to the sale of Woori, the first-round auction of which was due to start on June 29. However, a government official said the auction would proceed as planned, with regulators working to change ownership rules to drum up more interest. The sale of Woori is the lynchpin of South Korean President Lee Myung-bak's drive to reduce state ownership and recoup billions of dollars of taxpayers' money spent to rescue the financial sector in the wake of the Asian financial crisis in the late 1990s. KDB Financial had been the only credible declared bidder for a 57 percent stake in Woori, the country's largest financial group by assets, in a deal that would be the country's largest banking deal if done around the expected $6 billion. But KDB's planned bid drew criticism from legislators

and industry experts who said that combining the two state-owned banks would create a huge nationalised bank that would stifle competition.


U.S. securities regulators moved to stop two Chinese companies from selling their private shares to investors, in their latest effort to crack down on questionable financial statements by overseas companies. The Securities and Exchange Commission said it had begun so-called "stop order proceedings" against China Intelligent Lighting and Electronics Inc and China Century Dragon Media Inc. Both companies had trading suspended in their publicly-held stock on NYSE Amex in March 2011, and the exchange has initiated a delisting proceeding against them. The SEC decided to institute the stop order against the companies to prevent them from selling their shares privately after the independent auditors for both companies withdrew their audit opinions and resigned. The SEC said the move was needed because the registration statements were "materially misleading."


The U.S. Securities and Exchange Commission warned investors about the risk of fraud, accounting problems and other abuses at companies that obtain stock listings through so-called reverse mergers. The warning comes amid a rash of accounting scandals involving China-based companies listed on U.S. exchanges through reverse mergers, or mergers with U.S. shell companies. "Many companies either fail or struggle to remain viable following a reverse merger," the SEC said in an investor bulletin. It said investors should be especially wary of reverse merger operating companies that are "non-reporting," meaning they are not required to file reports with the SEC. Reverse mergers allow companies to trade on U.S. exchanges even though their operations may be overseas. The listing process is quicker than a traditional initial public offering but involves less scrutiny of a company's books.


Investors who have suffered a drubbing from accounting scandals at U.S.-listed Chinese companies are starting to sue the auditors who blessed their financial statements, but it will be tough for them to win in American courts. Shareholders have already sued a string of China-based, U.S.-listed companies for fraud, saying they lost money when stocks tanked after financial scandals emerged. They contend companies invented sham businesses, inflated revenue or gave vastly different information to U.S. and Chinese regulators.

The episodes have embarrassed auditing firms, raising questions about whether they have done enough to confirm basic numbers such as cash balances on a company's books. In one recent episode, Deloitte Touche Tohmatsu CPA Ltd quit working for Longtop Financial Technologies Ltd, saying it found "falsity" in the software company's records. So far, though, most of the lawsuits have named just the companies as defendants, but given their structures and shaky finances getting any compensation for losses may prove difficult. Plaintiffs would face difficulty in collecting on any judgments against entities which have most of their operations in China and often have legal homes in the Cayman Islands. As a result, the auditors may be added as defendants as the cases proceed. To prevail against auditors, plaintiffs must prove they acted with intent or recklessness. They would have to prove that the auditors knowingly made false statements when issuing reports that signed off on a company's financial statements. Plaintiffs would have to look at the auditors' work papers and communications with the company. But those documents are likely in China, where U.S. court rules on evidence-gathering often are not honored. Another obstacle for shareholders is the vast networks that comprise the so-called Big Four group of firms, which includes Deloitte, Ernst & Young, KPMG, and PwC. The auditors' Chinese or Hong Kong affiliates may be out of reach of U.S. lawsuits, and Chinese entities often have refused to comply with U.S. court proceedings. U.S. entities or parent groups could claim they have only loose legal or structural relationship with their Asian counterparts, giving them cover from lawsuits.

SINGAPORE | REUTERS, JUNE 14

Singapore proposed that company boards adopt a tougher role in policing financial statements, a move that comes as investors grow increasingly suspicious about the accounting practices of foreign-based firms. The city-state's Corporate Governance Council is proposing that boards must comment on the whether they have received assurances from a company's CEO and chief financial officer on the accuracy of the financial statements. Boards must also ensure that the management has put in place effective risk management and internal control systems. The move comes as accounting standards of some foreign-listed Chinese firms are under close scrutiny after a series of scandals involving financial irregularities. The Council said that the proposed code will be the same for domestic and foreign-based companies listed in the city. Singapore's 18-month long review of corporate governance also included new measures to ensure the independence of directors and to provide more disclosure about how many other directorships board members hold. This follows criticism from some investors in the city-state that independent directors have been drawn from too small a pool of talent and take on too many posts, meaning they do not spend the necessary time required for their role. The Council proposed that if the chairman and CEO roles are filled by the same person, if they are immediate family members or if they are both part of the management team, then at least half of the directors should be independent. It also proposed preventing people serving as independent directors if they have significant links to one of the company's major shareholders.


Life Partners Holdings Inc said accounting firm Ernst & Young quit as its auditor and withdrew opinion on the company's fiscal 2010 results, four days after it received a second Wells Notice from U.S. regulators. Life Partners, which is active in the secondary market for life insurance, is being investigated by the U.S. Securities and Exchange Commission and has received two Wells Notices within the space of a month.

According to the expanded Wells Notice, the SEC could bring a civil injunctive action against the company and three of its directors and executive officers, Brian Pardo, R Scott Peden and David Martin, for possible violations of certain sections of the Securities Act. Ernst & Young said in its resignation that it was no longer able to rely upon the management's representations, and that it was "unwilling to be associated with the financial statements prepared by management".


California-based eBay Inc and other companies should expect to fight their legal battles in Delaware if they decide to organize under the state's popular corporate law, a federal judge ruled. The ruling stems from a patent infringement lawsuit brought by Connecticut-based XPRT Ventures LLC against eBay Inc, PayPal Inc and other companies based in California and Maryland that are incorporated in Delaware. The companies argued the case, which involves patents covering online payment methods, should be transferred to the U.S. District Court for the Northern District of California. The defendants said they were sued in Delaware purely for "litigation reasons." U.S. District Judge Sue Robinson in Wilmington rejected that argument in her decision, as well as other arguments about inconvenience and congestion in Delaware's federal court.


U.S. Treasuries and futures may be the largest beneficiaries from reforms that will make the cost of transacting in the $364 trillion, privately traded interest-rate swap market significantly more expensive. If new rules, which are still being formed and are expected to be implemented in 2012, lead investors away from swaps and into bonds or futures, it may also dramatically impact the Treasury yield curve and could add to volatility in futures trading. The rules are part of the Dodd-Frank law and are designed to reduce the systemic risks posed by the web of privately traded derivatives, which helped roil the financial system in the crisis of 2008. The most extensive change will be the requirement that a majority of swaps be routed through central clearinghouses. The rules "will push marginal transactions toward the cash and futures markets," said Jim Caron, global head of interest rate strategy at Morgan Stanley in New York. Treasuries may benefit from increased demand from investors who need the bonds to pledge as collateral against swaps. This is because most clearinghouses require participants post collateral as cash, Treasuries or other similarly highly rated securities. Bank of America estimates that the move to clearinghouses could require $600 billion in collateral, though much of this need could be met by securities already held by investors. Others

may decide that futures are more attractive because of the higher costs of entering into privately traded swaps. Morgan Stanley estimates that the cost of using swaps may be three-to-five times greater than exchange traded futures after the changes.

EU | REUTERS, JUNE 9

The European Union is moving nearer to a deal on its derivatives crackdown that could risk confrontation with the U.S. which has warned it is straying from an agreed global approach. The EU, the United States and their partners in the world's top 20 economies (G20) pledged in 2009 that derivatives in the $600 trillion off-exchange (OTC) market should be standardised, cleared and traded on platforms, where possible, by end 2012. The aim is to curb risks that alarmed regulators when Lehman Brothers bank crashed in 2008, leaving a trail of derivatives with exposures that could not be quickly quantified. At a recent meeting most ambassadors from the EU's 27 states backed or raised no objections to a new compromise from the bloc's president Hungary, which proposed that the draft law's clearing requirements should apply only to off-exchange (OTC) derivatives while the mandatory reporting requirements would apply to all types of trades, including those executed on exchanges. This puts the member states on the same page as the European Parliament, which has joint say on the measure, thereby bringing a final deal within sight. Banks want clarity on how to prepare for major changes in the way they trade derivatives. The draft law contains safeguards so that users have a choice of where to clear trades. Britain, with backing from the US, wants the draft EU law to cover all derivatives so these safeguards apply to clearing of exchange traded derivatives as well. EU ambassadors meet again on June 16 in a bid to hammer out a fully agreed text among member states for finance ministers to endorse on June 20, so that negotiations with parliament on the final shape of the law can begin.

IRELAND | REUTERS, JUNE 13

The International Swaps and Derivatives Association (ISDA) ruled that a restructuring credit event had occurred at Allied Irish Banks after it amended the terms of its junior paper. A credit event is financial industry jargon for default on payment, breach of bond covenants or other event that casts doubt on an issuer's ability to service its debt. The derivatives industry body has the final say on whether a credit event has occurred, a ruling that would trigger the payout of CDS -- a popular financial tool used to hedge risk and speculate on changes in the likelihood of default.

US| IFR, JUNE 11

A proposal by the U.S. Commodity Futures Trading Commission on protection of client margins in cleared over-the-counter derivatives transactions has sparked fierce debate among market participants. Some central counterparties fear it could have a drastic impact on their business models, and some OTC clearing houses may have to raise client margins by as much as 270 percent to meet the rule’s segregation standards. The CFTC's proposed rule, designed to bolster protection of client margin held against OTC derivatives positions, which moves away from the mechanism used to protect margin in futures trades in the US, has caused an uproar among CCPs.

Other participants have highlighted the differences between the OTC and listed derivatives markets and suggest a "one size fits all" approach for margin segregation is inappropriate. While many buyside participants favour full-blown physical segregation -- which the CFTC's proposal does not provide -- most concede that the model on offer represents a fair compromise. The issue centres on how client margin is held at clearing brokers or futures clearing merchants. In the listed world, all client margin is pooled in an omnibus account at the FCM. As a result, if a client defaults and brings down the FCM with it, and their initial margin is not sufficient to close out their positions, the CCP would make up any shortfall from the omnibus account. To address this issue, the CFTC proposed four models in late 2010. Of these, "legally segregated, operationally commingled" has become the frontrunner. LSOC employs the current omnibus model until an event of default, at which point the CCP can see underlying client positions, identify where any margin shortfall lies, and ensure non-defaulting clients are shielded. However, LSOC would mean the omnibus account could no longer form part of default waterfalls for CCPs, which would have to substantially raise either initial margin or default fund contributions to compensate. ICE Trust and CME have estimated margin hikes of up to 270 percent and 63 percent respectively to comply with LSOC. Conversely, LCH.Clearnet has stated that LSOC would not warrant any adjustment. In private, some CCPs have said the CFTC has over-stepped its mandate from the Dodd-Frank Act and has failed to fully investigate other avenues.

CANADA | REUTERS, JUNE 13-16

Combining Canada's stock exchanges with alternative trading system Alpha Group and the country's major clearing hub would benefit Canadian capital markets, the Maple Group consortium, which is making a hostile takeover bid for stock exchange operator TMX Group, said. The Maple Group -- made up of Canadian banks and other financial institutions – has taken its $3.8 billion takeover bid for TMX, which operates the Toronto Stock Exchange, directly to TMX shareholders. It is trying to scupper a rival, friendly offer for TMX from the London Stock Exchange Group ahead of a June 30 vote on the LSE bid. Once it buys TMX, it plans to combine it with Alpha and clearing hub Clearing and Depository Services, which are both already largely controlled by the banks. Maple said its plan would benefit Canadian markets as it would result in an integrated trading and clearing exchange for equities, bonds, energy products and derivatives in both exchange-traded and over-the-counter markets. It said it was confident of regulatory approval for the bid, even though the group would also absorb TSX's main competitor Alpha. Persuading TMX shareholders that its offer can pass regulatory muster will be key to the success of the Maple Group bid as its plans have raised competition concerns. A combined TMX and Alpha would account for about 80 percent of Canadian stock trading by volume. In its official takeover circular, Maple sought to address shareholder concerns about the price it would be pay to combine Alpha and CDS with TMX. It said it will form a committee of its independent directors to oversee the process of evaluating the assets. Separately, the Maple group said Canada's 13 provincial and territorial regulators had granted its application for relief from certain provisions of the Securities Act, allowing it to proceed with a two-step offer to buy 100 percent of the shares of TMX. It said the relief cleared a minor regulatory hurdle for the group's takeover bid.


A top NYSE Euronext executive said the U.S.-based exchange's merger with Germany's Deutsche Boerse AG would lead to more job losses outside the United States than inside the country, in the short term. Lawrence Leibowitz, chief operating officer of the Big Board parent company, told a hearing in Washington that he "wouldn't expect many job losses" in the United States, adding the $10.2 billion deal would position the combined company to grow in the longer term. He said at a U.S. House of Representatives subcommittee hearing on the deal that the merger was not about cutting jobs, but about creating value. He expected the deal to be "good news for America and American jobs" in the long run.


NYSE Euronext has extended a contract with Anglo-French clearer LCH.Clearnet to buy time ahead of its planned merger with Deutsche Boerse and a possible takeover of LCH.Clearnet itself. NYSE Euronext said it had pushed back to 2013 the date at which it would stop using LCH to clear its European equities and derivatives trades. It said last year it would terminate the contract in 2012. NYSE Euronext said in May 2010 that it planned to bring its clearing in-house by setting up clearing houses in London and Paris in late 2012, a move that would have drawn a line under its long-standing relationship with LCH. But the NYSE Euronext clearing plan was thrown into doubt by the announcement in February 2011 that Deutsche Boerse, which owns clearing house Eurex Clearing, had agreed a $10.2 billion NYSE takeover. In May, LCH said it had been approached by various exchanges about possible tie-ups, with sources citing parties including NYSE Euronext and home-town rival Nasdaq OMX. Sources close to NYSE Euronext said the exchange was working with data vendor Markit on a joint bid that will involve LCH's equities and derivatives clearing services going to NYSE Euronext and its swaps clearing unit merging with Markit.


Britain's top fund managers called for an independent review into corporate failures such as Keydata, warning that the country will be judged by how it deals with the fallout from personal investment scandals. Douglas Ferrans, the chairman of the IMA trade body for the 3.4 trillion pound UK investment management industry, said the sector had stumped up almost 500 million pounds ($821 million) in compensation payments for failed investment firms in the last three years. He told an IMA (Investment Management Association) dinner in London that the scale of recent failures could not be ignored and that a review needed to take place in due course and its conclusions be published.

Fund managers have been enraged by a bill for more than 230 million pounds from the Financial Services Compensation Scheme (FSCS) in 2011, arguing Keydata's problems had nothing to do with the industry and should have been mitigated by regulators. The FSCS, Britain's safety net for investors when regulated businesses fail, said in January it had no choice but to bill the sector for part of the costs of claims from firms such as Keydata, which alone attributed around 247 million pounds of the latest levy.


Britain's Financial Services Authority (FSA) warned private-client wealth managers not to invest in assets their customers might deem too risky after a probe of the sector revealed "significant, widespread failings". A survey of 16 firms by the regulator found many were not catering sufficiently to their clients' views on how much risk they were prepared to take with their investments. Fourteen out of the 16 firms surveyed by the FSA were at risk of harming their customers' interests because of mismatches between their investment portfolios and their clients' financial needs and attitudes to risk, the regulator said. It wrote in a letter to around 260 wealth management chief executives that the findings gave rise to concerns that there was an "unacceptable risk of customers of wealth management firms experiencing unfavourable outcomes". The FSA said it was taking action against some firms, while others had taken steps to rectify the problem. It did not name any of the companies involved.

SOUTH KOREA | REUTERS, JUNE 16

South Korea said it would revise capital market regulations to allow homegrown hedge funds, betting the move would grow its financial industry, improve market liquidity and encourage funds into new business areas. The revision comes after the country's capital markets consolidation act, which came into effect two years ago during the global financial crisis, was criticised for failing to help nurture global financial players from the Asia's fourth-largest economy. The Financial Services Commission said that under the new regulation, individual investors will be allowed to directly invest in hedge funds, with minimum investment requirement set at 500 million Korean won ($459,707). Regulations on hedge fund management will be also eased -- borrowing limits will be raised to 400 percent of the fund's assets from 300 percent, value at risk from derivatives trade will be allowed to 400 percent and a mandatory investment requirement that meant more than 50 percent of fund assets had to be put into companies under restructuring will be scrapped.


A group of top U.S. lawmakers set an ambitious July 1 goal to reach a broad debt-reduction deal, even though Republicans and the White House are still far apart on taxes and healthcare. Vice President Joe Biden sat down in the Capitol with six lawmakers trying to agree on how to narrow huge budget deficits and raise the $14.3 trillion debt limit so the United States can avoid defaulting on its financial obligations and keep borrowing money to pay its bills. The group, which is hoping to break through the growing political partisanship in the run-up to November 2012 elections, talked about proposals that would trigger automatic spending cuts and possibly tax hikes if Congress cannot narrow trillion-dollar budget deficits in the coming years. Separately, President Barack Obama and Federal Reserve Chairman Ben Bernanke warned of the potentially devastating economic consequences if the debt limit was not raised by an Aug. 2 deadline, when the Treasury has warned it will run out of money. Bernanke said the U.S. could lose its prized AAA credit rating and the U.S. dollar's special status as a reserve currency might be damaged if Congress fails to act soon. He also warned that cutting the budget too sharply in the near term could endanger the economy's recovery. Republicans have said any increase in the debt limit must include spending cuts equal in size. That would mean cuts of at least $2 trillion to ensure Congress does not have to revisit the politically toxic issue before 2012 elections.

GLOBAL | REUTERS, JUNE 10

Appropriate monetary and fiscal policies are needed in addition to solid macroprudential regulation to foster financial system stability, the head of the Bank for International Settlements said. Jaime Caruana, General Manager of the Basel-based institution, said expectations for what macroprudential rules alone could accomplish should be modest: They could make banks more resilient in the event of a crisis but they would not necessarily contain the bubble building up. At a minimum, both fiscal and monetary policies needed to play a more active role than they have in the past, he said in the text of a speech prepared for a conference in Kerala, India. He said that given the uncertainties involved, it would be wise to avoid overly ambitious objectives. Caruana said the Greek debt crisis proved that governments needed to manage finances carefully, building up surpluses during good times, and that central banks would have to adapt their approach too: simply pursuing price stability over a two-year horizon was no longer be appropriate. Monetary policymakers would also need to keep an eye on longer-term trends, if they were to take into account the "gradual build-up and unwinding of financial imbalances and their economic and inflationary effect", he said. Moreover, concerns that there could be conflicts between macroprudential and monetary actions were overblown, he added. Instead, the two types of policy were generally complementary, though good coordination was still needed.


A year after it pledged to curb the power of the credit rating agencies, Europe remains at their mercy as it struggles to introduce regulatory steps and the agencies show little sign of softening their stance on the region's debt crises. The threat of stricter regulation has not deterred the agencies from downgrading the sovereign debt of Ireland and Portugal over the past several months, as well as demoting Greece further into junk territory.

The agencies have faced withering criticism from European politicians and officials over the last couple of years -- first for failing to warn of risks behind the global credit crisis, then for repeatedly downgrading Greece, Ireland and Portugal despite Europe's multi-billion euro bailouts of them. Now the big three agencies -- S&P, Moody's Investors Service and Fitch Ratings -- have their biggest opportunity yet to exercise power over Europe, as they prepare to rule on a second bailout of Greece. Officials argue unjustified downgrades have destabilised financial markets and undermined investors' confidence in the bailouts, pushing up sovereign bond yields around the euro zone. Top rating agency executives have been summoned before European finance ministers to explain the agencies' decisions. The European Securities and Markets Authority, a regional regulator set up this year with supervisory power over rating agencies, is pressing them to disclose more information about the methods and analytical models they use to reach decisions. And the EU's executive is drafting laws designed to curb the agencies by increasing their legal liability for ratings, among other things. If approved by European leaders and the European Parliament, the laws could come into force as soon as late 2012. So far, however, the agencies do not appear to be moderating their judgements in response to such threats. For example, all three have downgraded Cyprus in the last few months, citing its exposure to the possibility of a deep restructuring of Greek debt -- even though the EU insists such a restructuring is not on the cards. Meanwhile, efforts to assert control over the agencies have run into legal and practical obstacles. Although the EU is examining the idea of setting up a European agency to assess the creditworthiness of countries, providing an alternative to the agencies, it is not clear how this would be financed or run.

GERMANY | REUTERS, JUNE 10

The European Central Bank should toughen up its collateral rules once the current crisis is over, Governing Council member Erkki Liikanen said. Liikanen, who heads Finland's central bank, suggested on a number of possible changes to ECB's lending rules, rules which the central bank has loosened considerably during the financial crisis. He said one possibility was to make a clearer separation between the assets that are eligible for monetary policy operations and the assets that are eligible for operations addressing banks' specific liquidity needs. The ECB's current collateral rules state the central bank will accept Greek and Irish sovereign debt regardless of credit rating. Economists warn it leaves the central bank at risk of substantial financial losses if either of the countries default and banks in those countries collapse. At the same time, the ECB's vice president said that establishing a banking sector resolution fund financed by the private sector could provide a vehicle to act swiftly in the event of bank failures. Vitor Constancio said he favoured a more centralised framework for the resolution of banking sector problems in the euro zone. He said in a speech delivered to a conference in Frankfurt that the establishment of an Euro Area Resolution Fund, funded by ex-ante private sector contributions, was an avenue that could be considered.


The European Central Bank continually reviews the collateral it considers eligible for its bank lending operations, ECB policymaker Lorenzo Bini Smaghi said. The collateral the ECB accepts in its regular funding operations is central to the debate about a second rescue package for Greece as senior ECB policymakers have said the central bank could not accept restructured

Greek bonds as collateral in its lending operations. Such a scenario would cut off funding to much of Greece's financial sector. Bini Smaghi said the collateral the ECB accepts is always under review. Bini Smaghi's comments came after ECB Executive Board member Juergen Stark hinted earlier that there might be changes to the central bank's collateral framework.

FRANCE | REUTERS, JUNE 15

Moody's Investors Service placed France's top three banks, BNP Paribas, Societe Generale and Credit Agricole (CASA), on review for a possible downgrade, citing the banks' exposure to Greece's debt crisis. It based its decision on the banks' direct holdings of government bonds or credit extended to the Greek private sector, a key factor for CASA and SocGen due to their local Greek banks it noted. Moody's said potential mitigants to its concerns were the banks' strong financial profiles, substantial scale and earnings diversification. CASA's and BNPP's reviews were unlikely to lead to downgrades of more than one notch, while SocGen's debt and deposit ratings could be downgraded by as much as two rating notches, it added.

NIGERIA | REUTERS, JUNE 13

Nigeria's central bank has warned that eight lenders rescued in a 2009 bailout are in a "grave situation" as their operating losses mount and that vested interests risk derailing plans to recapitalise them. The central bank injected $4 billion into the lenders, found to be dangerously undercapitalised, in 2009. A state "bad bank" (AMCON) has brought them back to zero shareholders' funds while new investors have been sought to recapitalise them. Central Bank Governor Lamido Sanusi said court injunctions sought by minority shareholders risked blocking deals between four of the bailed-out lenders and new investors. Sanusi said in a statement issued on the central bank Website that the central bank could not afford to keep the interbank guarantee in place indefinitely, saying it was solely by this guarantee that the rescued banks had been able to keep going. Sanusi said he was committed to protecting depositors and creditors, pointing out that neither had lost savings or loans so far during the bank crisis. The central bank has given the lenders to the end of September to reach recapitalisation deals with new investors or face liquidation if they refuse to accept funds from AMCON, which would effectively mean nationalisation.


The United States and Switzerland are in advanced talks on a multibillion-dollar deal that would let several Swiss and European banks join a common settlement and avoid potential U.S. prosecution for helping wealthy Americans dodge taxes, senior persons briefed on the matter said. As part of the agreement under discussion, known as a global resolution, U.S. government

agencies would invite the banks to pay a fine, exit their undeclared offshore banking businesses for Americans, and turn over client names to the Internal Revenue Service (IRS) and the Justice Department. In exchange, the agencies would drop an ongoing investigation into the banks. Three current and former government officials briefed on the matter described the possible agreement but spoke on condition of anonymity, citing the wide-ranging investigation of Swiss and European banks by the two agencies. It could not immediately be determined which banks could be invited to participate in the global resolution. While U.S. and Swiss authorities were still working out the details, an announcement of a settlement could come as early as July, these persons said. The fines involved could collectively total several billion dollars, they said. Banks that "opt out" of the deal could face heightened scrutiny from U.S. authorities, including a possible legal summons for client names from the IRS and tougher scrutiny by the Justice Department.

TANZANIA | REUTERS, JUNE 12

Tanzania's parliament approved a $27.4 billion five-year development plan, backing the proposed introduction of a super-profit tax on mining companies. However, it would not impose the tax on existing mining companies, but will negotiate with the companies to have them pay the new tax, the country's mining minister said. William Ngeleja, Tanzania's energy and minerals minister, said the government would negotiate with existing companies how they will pay the tax, but that it will automatically apply to all new entrants into its mining sector. Tanzania, one of Africa's top gold producers, has remained noncommittal on if and when it might introduce the super-profit tax.

RUSSIA | REUTERS, JUNE 14

Russia's Finance Ministry proposed to more than double the mineral extraction tax (MET) for top natural gas producer Gazprom in 2012, Interfax reported, citing a deputy finance minister. According to Interfax, Sergei Shatalov said next year MET will soar to 480 roubles per 1,000 cubic metres from 237 roubles now. In 2013 it will further increase to 600 roubles and then rise to 635 roubles in 2014. Shatalov added that these tax proposals are still under discussion.


Democratic leaders in the U.S. House of Representatives said they would try to force a vote on a China currency bill that House members overwhelmingly approved in 2010 but that died in the Senate. House Democratic Leader Nancy Pelosi said party members were circulating a "discharge petition" to force Republicans who control the chamber to bring the bill to the floor. That would require 218 signatures, she said. The House passed the currency bill in 2010 by a vote of 348-79, with 99 Republicans joining 249 Democrats in support.

However, Republican leaders have said they do not plan to bring up the bill and have urged the Obama administration to focus instead on what they consider bigger problems in the U.S.-China trade relationship. Democratic Representative Sander Levin said Republicans should allow a vote on the bill if they were interested in protecting American jobs. He and many other lawmakers contend China's currency is undervalued by as much as 40 percent, giving Chinese companies an unfair trade advantage.


China will let banks convert some foreign currencies more easily, its currency regulator said, as Beijing takes another small step in easing its grip on capital flows. The changes, effective on July 1, have been under discussion since 2009 and are intended to help banks run their businesses more easily. But the State Administration of Foreign Exchange (SAFE) made clear that it will retain control over currency conversions closely linked to China's balance of international payments.

IRAN | REUTERS, JUNE 15

Iran's central bank announced a raft of measures to prop up the rial currency after a rush for dollars forced a devaluation. The measures, including raising domestic interest rates, came after the bank said earlier that it was injecting billions of dollars into the market to stabilise the currency. Central Bank Governor Mahmoud Bahmani said the Islamic Republic would also issue more bonds and abolish a sales tax on gold to make other investments more appealing to Iranians, who have rushed to buy dollars in recent weeks, depressing the value of the rial. Central bank chief Bahmani had already announced that Iran would inject between $1.5 billion and $3 billion into the market every week to support the rial after the bank devalued it by more than 10 percent a week earlier. Rising inflation, a reduction in bank interest for savers and a new value-added tax on gold coins have all pushed Iranians to seek hard currency as a safe haven for their wealth. While high prices for Iran's oil exports have replenished its foreign exchange reserves, analysts said a sanctions campaign led by Western states has made cross-border financial transactions more difficult and contributed to pressure on the rial.

INDIA | REUTERS, JUNE 13

India has sought the Organisation for Economic Co-operation and Development's help in mounting pressure on countries that are reluctant to disclose bank account details of Indians who have stashed illicit funds abroad, the finance minister said. Pranab Mukherjee said that while some countries had accepted to end bank secrecy in general, some had agreed to do so only from a prospective date and were not willing to exchange past banking information.

Mukherjee was speaking at an international tax conference jointly organised by Paris-based OECD -- a group of 34 industrialised countries -- and India's Ministry of Finance, which was attended by the OECD head Angel Gurria and tax experts from 30 countries. Mukherjee said competition among tax havens encouraged many Indians to park huge undisclosed income abroad, thereby causing revenue losses. Mukherjee's statement came as two hunger strikes over corruption in India also raised the issue of black money or illicit funds, and the government's inaction to repatriate them. He also said India would take appropriate steps against those countries that did not cooperate against tax evaders. The government has developed a "toolbox" to deal with non-cooperative jurisdictions by making appropriate changes in the Income Tax Act, 1961, Mukherjee said. India could impose at least 30 per cent tax deduction at source on payments made to entities located in non-co-operative countries and jurisdictions, finance ministry officials said.

AUSTRALIA | REUTERS, JUNE 15

Around ten banks, including lenders from resource-hungry China and India, are seeking bank licenses in Australia to tap into rising cross border M&A and infrastructure financing, as local banks struggle with new capital and liquidity rules. China's Agricultural Bank of China and Bank of Communications, Madrid-based Banco Bilbao Vizcaya Argentaria (BBVA), and Indian lenders Bank of Baroda and Union Bank of India are among banks that are awaiting regulatory clearance, the banks told Reuters. Jonathan Grosvenor, BBVA's managing director and head of corporate clients Asia Pacific, said project finance was the biggest driver behind the bank's application for a licence in Australia. Several other lenders have also submitted applications and are awaiting regulatory approval, according to sources familiar with the situation. Banks are flocking to Australia as they follow clients who are acquiring assets in the country's vital mining sector and spend heavily to expand mining operations.


An upcoming ruling by the World Trade Organization on whether China broke global rules by limiting raw material exports will bolster EU plans to challenge other curbs by Beijing, the bloc's trade chief said. EU Trade Commissioner Karel De Gucht told a conference of policymakers and industry executives considering growing shortages of raw materials that the panel decision, which will be public next month, will provide "interesting guidelines" on how to address this issue at the WTO in the future, also on rare earth materials. The United States, European Union and Mexico launched a dispute at the WTO in 2009 over their complaint that Chinese export restrictions on minerals such as bauxite and magnesium discriminated against foreign manufacturers who use the inputs and gave an unfair advantage to domestic producers.


The China units of HSBC Holdings and Citigroup Inc have won initial approval to underwrite corporate debt in China, paving the way for them to be the first foreign banks to win the coveted

licences, sources told Reuters. China's National Association of Financial Market Institutional Investors (NAFMII), an industry association under the central bank that supervises the country's debt market, has given the two banks the green light to underwrite corporate debt, two sources with direct knowledge of the approvals said. The two banks will still have to register with the People's Bank of China, the central bank, before they can start operations, the sources said.

SOUTH AFRICA | REUTERS, JUNE 14

South Africa's intervention in Wal-Mart's bid for control of Massmart was "aggressive" and could have been handled better, Massmart's chief executive told Business Report newspaper. South Africa's competition authorities in May approved Wal-Mart's $2.4 billion offer for 51 percent of Massmart, a discount retailer, with minimal conditions on the deal. Three government departments -- economic development, trade and industry and forestry and fisheries -- opposed the transaction and have said they may consider appealing the decision. In an interview with the daily Business Report newspaper, Massmart CEO Grant Pattison singled out the government's role in the transaction. He said he was surprised by the Department of Economic Development's aggressive intervention and said it was "not handled as well as it could have been". The government and South Africa's powerful unions argued that Wal-Mart's global supply chain would lead to a flood of cheap Asian imports, putting pressure on local manufacturers and sparking job cuts. Regulators imposed a two-year freeze on job cuts, but did not require the local procurement targets government and unions had pressed for.


Amtrak's heavily-used Northeast Corridor would be opened to private investment under legislation proposed in a bid to spur true high-speed rail service. Amtrak, a for-profit federal corporation, is the only long-haul passenger rail service in the United States, and for years a political hot potato over billions of dollars in U.S. government subsidies and losses. John Mica, the Republican chairman of the House of Representatives Transportation Committee, is promoting a bill that would transfer ownership of the Washington-New York-Boston route to the Transportation Department. The department would establish a committee that would manage the operations while seeking private investors, who may include overseas operators or other interests. Amtrak could have a role in the new system, possibly as operator. Mica said it was time for Congress to change the direction of America's "failed high-speed and intercity passenger rail service," after 40 years of "highly subsidized, poorly managed Amtrak operations". However, Transportation Secretary Ray LaHood said a preliminary review of Mica's plan raised questions about feasibility.

NETHERLANDS | REUTERS, JUNE 10

The Dutch government wants to privatise state power and gas grid operators, possibly as early as 2012, to raise funds to upgrade their networks, a ministry spokesman said. Candidates for privatisation include gas grid operator Gasunie and power grid operator TenneT, both of which require billions of euros to upgrade their infrastructure. Jan van Diepen, a spokesman for the ministry of economic affairs, agriculture and innovation, said the privatization process could start in the second half of 2012. The privatisation proposals were set out in a new energy policy paper, which also outlined mandatory co-firing of biomass in coal-fired power plants to reduce CO2 emissions, Van Diepen said. He said the policy paper would be debated in parliament on June 24.


The head of the U.S. Commodity Futures Trading Commission said the agency will not introduce its long-awaited position limits plan anytime soon as the futures regulator hears renewed calls from lawmakers pushing it to act over high energy prices. The CFTC proposed its plan in January 2011, and since then has received an estimated 12,000 public comments on the measure. U.S. lawmakers have turned up the heat on the CFTC to impose position limits as U.S. oil prices hover near $100 a barrel and consumers pay nearly $4 a gallon for gasoline. Despite the pressure, CFTC Chairman Gary Gensler told lawmakers it would be some time before the agency moves to finalize its position limits plan. He said the agency would try to move the plan as "soon as we humanly can". Gensler has laid out a rough roadmap of the agency's rule-making schedule set to begin on July 7. The CFTC, which will spend the remainder of the year finalizing rules, plans to hold votes on anti-manipulation regulations, large trader reporting, agricultural commodity definition and clearing measures in July and early August. A group of U.S. senators have introduced legislation to force the CFTC to crack down on speculators. The bill would require the CFTC to establish within two weeks of the legislation becoming law limits on oil contracts that are equal to the position accountability levels in place at the New York Mercantile Exchange since 2001. The measure also classifies Goldman Sachs, Morgan Stanley and other Wall Street investment banks that have proprietary oil trading as speculators, instead of bona-fide hedgers.


French President Nicolas Sarkozy urged G20 agriculture ministers to agree at talks in Paris to launch a farm information system that would gather and store market-sensitive data such as food stocks. He said it was important to have information on "world production, harvest forecasts, consumer demand or world stocks", in a speech to farm unions gathered at the Organisation for Economic Co-operation and Development headquarters.

Sarkozy said he wanted the database, to be hosted by the United Nation's Food and Agriculture Organisation, to gather all data on farm supplies, including those that concern public and private stocks, and be accessible to anyone. Resistance still exists among members, notably China, which has expressed reluctance to share information it considers as strategic.


Britain's Office of Fair Trading (OFT) is not proposing to investigate activities of large dealers in London Metal Exchange warehouses, the watchdog said in a response to a parliamentary committee. The Science and Technology Committed had in a recent report expressed concerns that the same firms that trade metals were able to store large amounts of metal on the LME, the world's top metals exchange. In a letter to the committee written on May 27, the OFT said it did not see any obvious competition issues that would merit further investigation at this stage. Controversy has swirled in recent months after one firm, which trading sources identified as Glencore, gained control of up to 80 percent of lead stocks at the same time that cash premiums for the metal soared. In May, the LME in May denied any improper activity was taking place and said robust regulations were already in place regarding warehouses.


More than 100 countries will pledge to strengthen national nuclear regulators and improve safety standards at a high-profile meeting this month called after Japan's atomic disaster, a draft declaration showed. The vaguely-worded text -- obtained by Reuters ahead of a June 20-24 ministerial conference at the U.N. nuclear agency -- may disappoint those hoping for concrete and quick international action to avert any repeat of the Fukushima emergency. Diplomats accredited to the International Atomic Energy Agency, the Vienna-based U.N. body, say the meeting will start a process aimed at boosting global nuclear safety. But they acknowledge that member countries are split over the issue of mandatory international rules and whether a body like the IAEA should have powers to enforce them. The draft declaration said ministers would emphasise the "importance of implementing enhanced national and international measures to ensure that the highest and most robust levels of nuclear safety are in place." They would also consider strengthening the international legal framework for nuclear safety, it added, without giving specific examples. The text stressed the need to improve national and international emergency preparedness.


The head of the Senate Energy Committee turned up the heat on the country's futures regulator by asking the agency to explain what was behind the recent movement in oil prices. Democrat Jeff Bingaman was the latest lawmaker to question oil price volatility, out of many lawmakers pushing the CFTC to act. In a letter to the chairman of the CFTC, Democrat Jeff Bingaman asked the agency to explain if major market players, such as banks, have an incentive to increase existing volatility in the oil markets. He also asked whether increased margin calls have affected price formation across the commodities arena. Bingaman said, indications are that there is, "plenty of oil available to meet current world oil demand," despite lost oil output from Libya. Yet, volatility in the oil price had

increased rather than decreased as the situation in Libya has become clearer, he noted. He asked the CFTC to respond by July 1.

IRAN | REUTERS, JUNE 15

Iran's biggest crude oil tanker operator NITC said it has secured ship insurance cover mainly in Asia after European providers pulled out earlier in 2011 due to sanctions imposed on the Islamic Republic. Earlier in 2011 privately-owned tanker group NITC lost its third-party liability insurance and pollution cover from the P&I Club market, marine insurers owned by shipping clients. NITC's hull and machinery cover, which covers physical loss or damage to a vessel, was also not renewed for the 2011/12 policy year due to sanctions. NITC said in a statement that it had secured alternative H&M cover elsewhere, with about 80 percent underwritten by Asian insurers and the remaining 20 percent placed in Iran. It said the cover with Iranian domestic companies did not include Tehran-based Moallem Insurance Co, which has already been targeted under EU sanctions. NITC said the H&M cover for its modern fleet of tankers involved "highly rated" underwriters from outside the EU, without giving further details. NITC commercial director Habibolah Seyedan said 100 percent of its P&I cover was provided in Asia. He said the only problem with this was that it was more expensive than obtaining insurance cover in London. NITC said it was not on any list of UN, U.S. or EU targeted companies, adding it was not linked in any way to Iran's other major shipowner, the Islamic Republic of Iran Shipping Lines (IRISL), which has been targeted under the sanctions regime.

CANADA | REUTERS, JUNE 13

The province of Manitoba will lead an advertising campaign to stop the federal government from stripping the Canadian Wheat Board of its monopoly on the Western Canadian grain trade, the provincial government said. Canada's Conservative government plans to introduce legislation this autumn to end the Wheat Board's marketing monopoly on wheat, durum and barley by August 2012. Manitoba has no direct say in the future of the Wheat Board, which is governed by federal law and controlled by government appointees and farmer-elected directors. But Premier Greg Selinger said the province is joining the CWB and some farm groups in demanding that Ottawa hold a vote by farmers to decide the CWB's future, as required by the current legislation. The monopoly requires Western farmers to sell wheat, durum and barley only to the Wheat Board, unlike the open-market system for other crops. The board is the world's last major agricultural monopoly and has been in place since the Second World War.

FRANCE | REUTERS, JUNE 15

France's telecoms regulator ARCEP opened bidding for fourth-generation (4G) mobile licences, kicking off a process the government hopes will raise at least 2.5 billion euros ($3.6 billion). ARCEP has set deadlines of Sept. 15 for applications for the 2.6 gigahertz band and Dec. 15 for the 800 megahertz band, considered the most valuable. It will allocate 2.6 GHz-band spectrum this autumn and 800 MHz-band spectrum in early 2012. The government has made clear it is determined to maximize the value of the licences while, at the same time, maximizing competition. France Telecom's rivals SFR, Bouygues and new player Iliad have lobbied for caps on the amount of spectrum any one group could buy to stop the former state monopoly winning most of the frequencies. The government agreed to a cap, but it will still allow deep-pocketed bidders to buy half the spectrum in the 800 MHz band.


The cable and broadband industry needs to encourage the remaining third of the U.S. population without broadband access to adopt high speed Internet connections, a top U.S. official said. Federal Communications Commission Chairman Julius Genachowski told the annual Cable Show the FCC has launched a Broadband Adoption Taskforce to help the public and private sectors tackle the broadband gap. The FCC says up to 100 million Americans do not subscribe to any broadband services. Genachowski said that, while access had grown to 67 percent from 65 percent of the market a year ago, this compared poorly with countries such as Singapore, where 90 percent of the population has broadband access. The FCC Chairman said broadband was critical to the economic future of Americans, citing an example that more than 80 percent of S&P 500 companies only advertise job vacancies online. Genachowski said the FCC will work with the industry and local governments to address affordability, relevance, digital literacy and trust, all issues that have held back broadband adoption.

US | REUTERS, JUNE 13-16

The public website of the U.S. Central Intelligence Agency went down and the U.S. Senate's website was attacked by the hacker group Lulz Security. The CIA site could not be accessed on June 15 from New York to San Francisco, and Bangalore to London. Earlier in the week, the hacker group broke into a public portion of the Senate website but did not reach behind a firewall into a more sensitive portion of the network. Lulz Security, which claimed responsibility for the attacks, has defaced websites, posted personal information about customers and site administrators, and disclosed the network configurations of some sites. Some security analysts have downplayed the significance of these attacks, saying the hackers are just looking to show off and get as much attention as possible. In the case of the CIA attack, hackers would not be able to access sensitive data by breaking into the agency's public website, said Jeffrey Carr, author of the book Inside Cyber Warfare: Mapping the Cyber Underworld. Lulz only made claims that it attacked www.cia.gov, and there was no evidence that sensitive data in the agency's internal computer network had been compromised. Lulz, whose members are strewn across the globe, announced the CIA attack on Twitter. Although the group, also known as Lulz Boat, fashions itself more as pranksters and activists than people with sinister intent, its members have been accused of breaking the law and are wanted by the FBI and other law enforcement agencies. The Sergeant at Arms Office, which provides security for the Senate, said that the breach had not compromised any individual senator's information.


Citigroup Inc said a cyber-attack in May 2011 affected almost twice as many people as the bank's figures had initially suggested. A total of 360,083 North American Citigroup credit card accounts were affected by the breach, the bank said in a statement. Customers had their names, account numbers and contact information accessed, but Citi said that "data critical to commit fraud was not compromised" and that other consumer banking online systems were not accessed. Citigroup also said it identified "the majority" of accounts compromised within seven days, adding that the information was accessed on the accounts by May 24 but that it only started notifying customers of the breach on June 3. Some 217,657 accounts have been reissued with new credit cards along with a notification letter, the bank said.

ASIA | REUTERS, JUNE 14

South Korea said it was drawing up a cyber-security master plan after a wave of hacking attacks against global agencies and companies but some other Asian governments appeared to have no blueprint for tackling the threat. Similarly, Indonesia, a rapidly growing G20 country, warned that hackers could cause serious damage to its institutions. Internet industry bodies and security experts in Asia said the borderless nature of the internet called for a coordinated international policy response.

In Seoul, capital of the world's most wired country, a large government task force is working on tactics to address threats, and officials said they would allocate extra cash and manpower to toughen protection of national economic and industrial installations. South Korea, still technically at war with North Korea, is vulnerable due to its high Internet penetration and as the likely target of its reclusive rival, officials said. In the Philippines, efforts to legislate against cyber threats have foundered because of a lack of urgency, said Trish Abejo, chief of staff of the head of the government's Commission on Information and Communications Technology. The perception that security of information is a technical problem, rather than an operational or strategic one, has until recently meant the issue has not been a government or corporate priority. A Japanese official said government-affiliated organisations in Japan had managed to repel major cyber-attacks, but added this was no reason for complacency. India's top information technology bureaucrat, R. Chandrasekhar, said high-level cooperation between states was needed to combat the problem. He called for the emergence of a "clear organisational mechanism" to fight cybercrime. India's computer networks have frequently been attacked, with the hackers suspected to be from China and Pakistan. A spokesman for Australia's Attorney-General Robert McClelland said cyber security would be a key issue at a meeting of attorneys-general from Australia, the United States, Canada, Britain and New Zealand in Sydney in July.


Richard Shelby, the lead Senate Republican on banking issues, said that he plans to support the White House's nominee to head the Federal Deposit Insurance Corp. Shelby's support is key to getting any nominees confirmed for the many openings at financial regulatory agencies, which are currently implementing the 2010 Dodd-Frank financial oversight law. In recent months, Shelby's opposition helped sink the nominations of Peter Diamond to be a governor of the Federal Reserve Board and Joseph Smith to be director of the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac. On June 10, Obama announced he would nominate Martin Gruenberg to replace Sheila Bair as head of the FDIC, one of the main U.S. banking regulators. Bair is leaving the job on July 8. Gruenberg is currently No. 2 on the FDIC board and before joining the agency in 2005 he was a longtime Democratic aide on the Senate Banking Committee. Shelby was a member of the Banking Committee when Gruenberg worked there before leaving for the FDIC, which insures individual accounts up to $250,000 and manages bank failures. Shelby's support does not guarantee Gruenberg will be quickly confirmed but it removes a major roadblock.

June 20 – UK Financial Services Authority and Bank of England holds conference in London on how the new UK regulatory structure will treat insurers June 21 - EU finance ministers meet in Brussels, with derivatives regulation and perhaps bank capital backstops on the agenda. June 22 – UK Financial Services Authority holds one day conference in London on Financial Crime regulation) June 22 - G20 farm ministers kick off two days of meetings, looking at commodities regulation to crack down on what some see as too much speculation pushing up prices. (Paris/Commods) June 22 - European Commission to publish amendments to capital requirements directives June 22 - U.S. Securities and Exchange Commission to vote to adopt rules for hedge fund adviser registration, consider final rules for exempting venture capital fund advisers June 23 – UK Financial Services Authority holds annual meeting with Chairman Adair Turner June 24 - Bank of England's Financial Policy Committee holds press conference to present its first Financial Stabilty Report, which may contain recommendations for changes in how bank and other financial regulation are applied.) June 24 – Comments due on swaps-market margin and capital requirements as proposed by U.S. Federal Deposit Insurance Corp and other bank regulators June 24 – European Parliament set to vote on derivatives regulations June 30 – Comments due to U.S. Consumer Financial Protection Bureau on list of rules and orders that it will enforce JULY July - Financial Stability Board to consider initial draft recommendations on regulation of shadow banking system July 5 – Deadline for comments on SEC proposal to remove references to credit ratings under the Exchange Act July 7 – SEC roundtable on incorporating International Financial Reporting Standards July 11 – Comments due to SEC on investment adviser performance compensation, feasibility study on ratings of structured-finance products July 11 – Comments due to CFTC on swaps margin requirements *July 14 – Comments due to SEC on disqualifying felons from private placement participation July 22 – Comments due on U.S. Federal Reserve proposal on minimum mortgage underwriting standards, including ability-to-pay requirements.

(Coming Up calendar includes contributions from CMS Cameron McKenna LLP, via www.complinet.com, a Thomson Reuters company and leading provider of compliance information to the regulated financial services

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