The Committee on Payments and Market Infrastructures (CPMI), the global standard setter for payment, clearing, settlement and related arrangements, urges stakeholders to pursue a common strategy to improve the security of wholesale payments that involve banks, financial market infrastructures and other financial institutions.

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The Committee on Payments and Market Infrastructures, of the BIS, has released a report on Reducing the risk of wholesale payments fraud related to endpoint security. This report first discusses the wholesale payment ecosystem and endpoints, and the risk of wholesale payments fraud, stressing the need for a holistic approach and coordination. It then presents the strategy, which comprises seven elements. It then discusses the CPMI’s plan to promote, support and monitor local and global progress in operationalising the strategy, with due recognition of the need for flexibility to reflect the uniqueness of each system and jurisdiction, including the legal, regulatory, operational and technological structures and constraints under which they may operate.

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The Financial Conduct Authority (FCA) has published its interim report into the mortgage market. The FCA found that competition in the mortgage market is working well for many people. The FCA has identified a number of ways in which the market could work better for some people. The FCA’s proposals are particularly aimed at helping customers find the best-priced suitable mortgage deal. The FCA also wants to help longstanding borrowers who are currently unable to switch to a better deal, often referred to as ‘mortgage prisoners’.
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According to a recent study by PwC, 75% of major companies will experience at least one instance of supply chain disruption over a 12-month period. 42% of companies will also experience a multi-tiered supply chain issue over the same length of time. The well-publicised supply chain issues experienced by KFC in the UK further highlight the importance of ensuring that businesses’ supply networks are sufficiently robust, and are able to guarantee delivery of vital goods and services in difficult conditions.

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Hostility towards the media is spreading from dictatorships to democracies, encouraged by U.S. President Donald Trump’s and other leaders’ attacks on ‘fake news,’ according to the 2018 World Press Freedom Index. The annual yardstick produced by the advocacy group Reporters without Borders, which measures media freedom in 180 countries, found assaults on the press – ranging from taunts to murder – were becoming graver. The worst decline in freedom was in Europe, though the region is still the world’s safest for journalists, according to the index. Two murders helped drive the decline. In October 2017, Daphne Caruana Galizia, a prominent Maltese journalist who probed corruption by the country’s elites, was assassinated in a car bomb. In Slovakia, 27-year old investigative reporter Jan Kuciak and his fiancée Martina Kusnirova were shot to death during Kuciak’s investigation of ties between Slovakian officials and Italian Mafia figures.
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The European Central Bank (ECB) publishes the European Framework for Threat Intelligence-based Ethical Red Teaming (TIBER-EU), which is the first Europe-wide framework for controlled and bespoke tests against cyber attacks in the financial market. The ECB promotes the safety and efficiency of payment, clearing and settlement systems in the euro area under its oversight mandate, guided by oversight regulations, standards, guidelines and expectations. At Eurosystem level, the ECB is the competent authority for the systemically important payment systems in the euro area: TARGET2, EURO1 and STEP2-T, and is the lead overseer for TARGET2-Securities; oversight of other payment systems lies with the national central banks.

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The Bank for International Settlements (BIS) estimate a panel Bayesian vector autoregression model for a cross-section of seven advanced European economies and produce out-of-sample forecasts of GDP conditionally on observed developments of interest rates and credit. BIS shows that, by using a smooth transition version of the model and allowing the parameters to vary across economies conditionally on their liquidity dependence (i.e. dependence on the availability of funding from external sources), it is possible to improve the accuracy of the forecasts. BIS concludes that the degree of liquidity dependence is likely to be among the important predictors of heterogeneity in macro-financial linkages across countries.

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In his speech, IMF First Deputy Managing Director David Lipton, address the important issue of multilateralism. The high level of attendance and representation in Bulgaria at this conference is testament to how seriously these issues are taken in Europe, and that is encouraging to all of us at this juncture. Until recently, the theme of multilateralism probably would have prompted me to focus on governance reforms at the IMF. But times have changed.
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