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Recent Editions
Risk Channel
North America
The Federal Reserve said on Wednesday that the 32 largest U.S. banks remain well capitalized and are capable of withstanding a severe economic downturn while continuing to lend, after its annual stress tests showed the sector could absorb more than $700bn in hypothetical losses and still remain above minimum capital requirements. Under the test scenario, banks faced a global recession featuring 10% unemployment, a one-third decline in real estate prices, and significant financial market turmoil. The banks' aggregate common equity tier one capital ratio fell from 12.8% to 11.2% during the simulated downturn, a decline of 1.6 percentage points, but remained comfortably above regulatory minimums. The hypothetical losses included roughly $200bn from credit cards, $160bn from commercial and industrial loans, and $75bn from commercial real estate, although stronger net interest income helped offset some of the impact.
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Risk Channel
UK/Europe
The European Trade Union Confederation (ETUC) has said European workers should be allowed "cooling breaks" - just like World Cup footballers - on sweltering summer days. "The cooling breaks being used at the World Cup have put the spotlight on the danger posed to workers by extreme heat and the kind of measures that can be taken to keep people safe," ETUC General Secretary Esther Lynch said. "Builders, fruit pickers or bus drivers need a lot longer than three minutes to recover, but [the World Cup] is a good example of how work can be adapted to the changing climate." The lobby group wants the European Commission to grant workers a "right to breaks without loss of pay" when temperatures are high.
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