California
09-18-2008, 02:26 PM
http://www.naic.org/committees_e.htm
http://www.naic.org/documents/committees_e_080903_capital_requirements.pdf
From two of Dave's slides:
(Australian Prudential Regulation Authority Speech Oct. 9, 2003)
• Looking ahead, the main potential source of risk to financial stability would be a substantial correction in the housing market, impacting on the balance sheets of authorized deposit-taking institutions through mortgage defaults. The concern would be a sharp jump in mortgage defaults…
• Since reporting process had “the right lights on” APRA requested companies to run a stress test (30% one year reduction in housing prices + increase in defaults)
• http://www.apra.gov.au/Speeches/03_20.cfm
RESULTS
1. Tests identified weaknesses
2. Corrections were made to capital and concentration risks
3. PMI Australia’s rating higher than its parent rating
4. International recognition as strong & robust for banks and mortgage insurer market.
5. SO YES, SOMETIMES YOU CAN KNOW WHAT YOU DON’T KNOW AHEAD OF TIME
http://www.naic.org/documents/committees_e_080903_capital_requirements.pdf
From two of Dave's slides:
(Australian Prudential Regulation Authority Speech Oct. 9, 2003)
• Looking ahead, the main potential source of risk to financial stability would be a substantial correction in the housing market, impacting on the balance sheets of authorized deposit-taking institutions through mortgage defaults. The concern would be a sharp jump in mortgage defaults…
• Since reporting process had “the right lights on” APRA requested companies to run a stress test (30% one year reduction in housing prices + increase in defaults)
• http://www.apra.gov.au/Speeches/03_20.cfm
RESULTS
1. Tests identified weaknesses
2. Corrections were made to capital and concentration risks
3. PMI Australia’s rating higher than its parent rating
4. International recognition as strong & robust for banks and mortgage insurer market.
5. SO YES, SOMETIMES YOU CAN KNOW WHAT YOU DON’T KNOW AHEAD OF TIME