Download PDF of Press Release

FOR IMMEDIATE RELEASE

CONTACT:
Sean Oblack
202.649.4629

Issue Also Features Interview with New TCH Chairman Brian Moynihan on Opportunities and Challenges in Banking

New York – December 8, 2014 – The Clearing House today released its fourth quarter 2014 issue of its quarterly journal, Banking Perspectives. The newest edition, entitled Financial Resiliency: Promoting Stability and Growth, focuses on how to achieve a regulatory architecture that promotes financial stability while ensuring that the banking system can contribute to robust economic growth.

“This issue takes a deep dive on the trade-off between financial stability and economic growth, which too often gets overlooked in the post-crisis era,” said Paul Saltzman, President of The Clearing House Association.  “We must begin to assess not only the components of financial stability but also those related to macroeconomic performance: credit extension, cost of credit, and market liquidity, for example. I am excited that this issue asks important questions and provides thought-provoking observations about how to find the optimal state where regulations provide for a banking system not only stable enough to withstand systemic shocks but also robust enough to maximize sustainable economic growth.”

The issue features articles from leading academics, former regulators, and other thought leaders, including Andrew Lo of MIT’s Sloan School of Management, who describes how we can take steps to better measure the tradeoffs inherent in macroprudential regulation, and the University of Chicago’s Randy Kroszner, who discusses the significant challenges inherent in crafting macroprudential rules and cautions policymakers on the potential pitfalls they may face.

“We measure many aspects of our macroeconomy such as inflation, output, and unemployment but we currently have no measure of aggregate risk in the economy,” Mr. Lo writes in his article Macroeconomic Modeling and Financial Stability: Lessons from the Crisis. “Macroeconomic risks must be modeled more accurately and monitored more regularly…[and] a broader set of measures, including those that focus on patterns in financial linkages, may be more appropriate to act as early warning indicators.”

The Clearing House is also pleased to feature Bank of America CEO and incoming Chairman of The Clearing House Brian Moynihan in this issue’s State of Banking interview, who discusses the opportunities facing the banking industry, his new role as chairman of The Clearing House, and the implications of technological growth on cybersecurity, payments and banks business models.

This quarter’s Banking Perspectives also includes an article by The Clearing House’s Alexey Levkov and Clark Peterson on the cost of capital. They use a standard corporate finance framework to describe why increasing capital requirements results in both firm-level and social costs.

Also in this issue, Sullivan & Cromwell’s Samuel Woodall III offers a legislative outlook for financial services reform under the new Congress and describes why there may be opportunities to amend Dodd-Frank. 

Lastly, Shearman & Sterling’s Donna Parisi and Barnabas Reynolds explore the potential impact of margin requirement rules on financial resiliency.

TCH began publishing Banking Perspectives in November 2013 to help foster debate and discussion on the issues shaping the evolving banking landscape. The first quarter 2015 issue will take a critical look at cross-border capital flows and whether new regulatory reforms are leading to a Balkanization of a globalized financial economy.

For a complimentary subscription, please click here.

About The Clearing House Established in 1853, The Clearing House is the oldest banking association and payments company in the United States. It is owned by the world’s largest commercial banks, which collectively employ more than two million people and hold more than half of all U.S. deposits. The Clearing House Payments Company L.L.C. provides payment, clearing, and settlement services to its member banks and other financial institutions, clearing almost $2 trillion daily and representing nearly half of the automated-clearing-house, funds- transfer, and check-image payments made in the U.S. The Clearing House Association L.L.C. is a nonpartisan advocacy organization representing – through regulatory comment letters, amicus briefs, and white papers – the interests of its owner banks on a variety of systemically important banking issues. See The Clearing House’s web page at www.theclearinghouse.org.