External funding dried up as the economy collapsed, pushing the current account roughly into balance. Import compression was unavoidable as exports fell. External deficits are not the issue, unlike past EM crises.

February 2019 IIF Global Regulatory Update provides updates on the 2019 workplan of the Financial Stability Board, and updates on current work streams in Market Fragmentation, Market Risk, Accounting, Operational Resilience, Digital Finance, Sustainable Finance, AML/CFT, Insurance and upcoming events.

Sharp improvement in risk appetite reflects improved valuations as well as more supportive Fed policy; As new U.S. sanctions take hold, holders of Venezuelan bonds contemplate next steps; Wobbles in the leveraged loan market; millennials give a boost to U.S. commercial real estate; ESG index performance—doing good doesn’t mean giving up returns, especially in emerging markets!

The final revised Basel III Market Risk standard was published on January 14th in the new ‘modular’ format. We have arranged for a comparison document/tool which provides a comparison between the standards and an overview of the differences between the text of the 2019 and 2016 market risk rules.

The IIF, our members and other associations developed an industry response to the BCBS consultation paper (CP) on “Leverage ratio treatment of client cleared derivatives.”

The joint associations industry have published a comment letter on the FSB Discussion Paper: “Financial resources to support CCP equity in resolution”.

We assess Venezuela’s macroeconomic fundamentals after years of policy mismanagement and social turmoil. The GDP drop is on par with the Soviet Union’s collapse.