Global ETF News Older than One Year
IMF paints bleak picture for DB funds
April 7, 2017--Defined benefit (DB) pension funds across the world may be forced to cut benefits "significantly" in the long term because of ultra-low interest rates, the International Monetary Fund (IMF) has warned.
Shifting asset allocations to meet required returns "appears feasible only by taking potentially unacceptable levels of risk", the fund said in a new report.
Source: ipe.com
IMF-How an Extended Period of Low Growth Could Reshape the Financial Industry
April 6, 2017--What happens if advanced economies remain stuck in a long-lasting funk marked by tepid growth, low interest rates, aging populations and stagnant productivity? Japan offers an example of the impact on banks, and our analysis suggests that there could also be far-reaching consequences for insurance companies, pension funds, and asset-management firms.
You might argue that this scenario of economic malaise has already materialized; after all, interest rates and economic growth have been low since the financial crisis in 2008. The question is whether the post-crisis landscape represents a temporary departure from the pace of growth we’ve come to expect since World War II, or whether it's the start of a new normal.
Source: IMF
IMF-Global Financial Stability Report
April 6, 2017--Chapter 2 : Low Growth, Low Interest Rates, and Financial Intermediation
Chapter 2 analyzes the potential long-term impact of a scenario of sustained low growth and low real and nominal rates for the business models of financial institutions and the products offered by the financial sector. Advanced economies have experienced low interest rates and growth since the global financial crisis.
Despite recent signs of an increase in longer-term yields, an imminent exit from low rates is not guaranteed, given the prevalence of slow-moving structural factors, such as demographic aging and stagnation in productivity growth. The confluence of these factors could change the nature of financial intermediation. Credit demand would likely be lower whereas household demand for transaction services would likely rise. Consequently, banking in advanced economies may evolve toward fee-based services. Aging will increase demand for health and long-term-care insurance, and low asset returns would accelerate the transition to defined-contribution private pension plans. Demand is likely to weaken for long-term savings products offered by insurers in favor of passive index funds. Policies could help ease the adjustment to such an environment by providing incentives to ensure longer-term stability instead of merely attenuating short-term pain.
Source: IMF
Prudential treatment of problem assets-definitions of non-performing exposures and forbearance
April 4, 20176--The Basel Committee on Banking Supervision has today released the final guidance on the Prudential treatment of problem assets-definitions of non-performing exposures and forbearance.
The definitions promote harmonisation in the measurement and application of two important measures of asset quality, thereby fostering consistency in supervisory reporting.
Source: BIS
Gone with the Headwinds: Global Productivity
April 3, 2017--Productivity growth-the key driver of living standards-fell sharply following the global financial crisis and has remained sluggish since, adding to a slowdown already in train before.
Building on new research, this note finds that the productivity slowdown reflects both crisis legacies and structural headwinds. In advanced economies, the global financial crisis has led to "productivity hysteresis"-persistent productivity losses from a seemingly temporary shock.
Behind this are balance sheet vulnerabilities, protracted weak demand and elevated uncertainty, which jointly triggered an adverse feedback loop of weak investment, weak productivity and bleak income prospects. Structural headwinds-already blowing before the crisis-include a waning ICT boom and slowing technology diffusion, partly reflecting an aging workforce, slowing global trade and weaker human capital accumulation. Reviving productivity growth requires addressing remaining crisis legacies in the short run while pressing ahead with structural reforms to tackle longer-term headwinds.
view the IMF Discussion Note: Gone with the Headwinds: Global Productivity
Source: IMF
World Bank-More Action Needed to Meet Energy Goals by 2030, New Report Finds
April 3, 2017-The current pace of progress on three global energy goals- access to electricity, renewable energy and efficiency- is not moving fast enough to meet 2030 targets, according to the latest Global Tracking Framework (GTF) report released today by the World Bank and the International Energy Agency as part of the Sustainable Energy for All Knowledge Hub.
The report shows that the increase of people getting access to electricity is slowing down, and if this trend is not reversed, projections are that the world will only reach 92% electrification by 2030, still short of universal access.
Source: World Bank
BlackRock's active funds navigate rough seas
April 2, 2017--The asset manager insists it is sailing, not bailing, says Stephen Foley.
Source: FT.com
Social Investing Grew to $23 Trillion in 2016
March 31, 2017--The U.S. accounts for 38% of global sustainable, responsible and impact investments assets
Global assets professionally managed under sustainable and responsible investment strategies soared to $23 trillion in 2016, a 25% increase from 2014, the Global Sustainable Investment Alliance reported this week in its biennial review.
Source: thinkadvisor.com
Active investing: a new hope
March 31, 2017--Loophole gives the true stock pickers a chance to beat their low-cost rivals
Source: FT.com
Revisions to the global systemically important banks assessment framework proposed by the Basel Committee
March 30, 2017--The Basel Committee on Banking Supervision today released a consultative document entitled Global systemically important banks-revised assessment framework. This document presents proposed revisions to the Committee's 2013 methodology for assessing and identifying global systemically important banks (G-SIBs).
The broad aim of the G-SIB framework is to reduce the probability of failure of a G-SIB by increasing its going-concern loss absorbency.
Source: BIS
