Articles by Raimundo Poveda

About the Author

Raimundo Poveda
Raimundo Poveda is a former Bank of Spain's banking supervision director.

Banking regulation, a never-ending story

The implentation of Basel III is taking its time. The adjustment periods are very long and drawn-out; the refinement of the concept of capital will not be completed until 2022. We have also seen that the implementation of the TLAC requirements, ratified at November’s G20 meeting, will not happen quickly. Until these adjustments are completed, the banks and the markets will still feel there is no break from regulation.


GLAC, a term you’ll need to become familiar with after the summer

MADRID | By Raimundo Poveda | Those who are interested in banking policy are doomed to learn some new term day in, day out. GLAC (i.e. “gone-concern loss-absorbing capacity”) is the capacity to absorb the losses of an unfeasible bank. Let us recall that the banking regulation declares a bank “unfeasible” not when it collapses but when it fails to comply with the minimum capital requirements –even if its financial assets are positive.

European Banking Union

European Banking Union, Arcadia Felix

MADRID | By Raimundo Poveda | With the typical delays of the first willful calendars, the European Community Resolution that regulates a common supervisor for the euro zone and guests (SSM, single supervisory mechanism) was finally published. Press and politicians are announcing the Banking Union, a new name for an invention of limited scope. We already had a common banking market since 1989, and a European Banking Authority since 2011. The Banking Union will turn back the financial Balkanization process triggered by the crisis. So entities will get abundant credit at unified interest rates, just as during the bubble; SMEs in the South will pay for credit the same as German SMEs; and there will be credit! We will go back to the Arcadia Felix of the first five years of the century. True? Well, maybe not.

Basel regulations

Liquidity ratios may be Basel next error

MADRID | By Raimundo Poveda, former director general of banking regulation at Bank of Spain | Liquidity ratios may be Basel next error: a compulsory ratio of liquidity that shall enter into force in 2015.