The Rules Of Chairmanship British Style

Basel Committee Liquidity Rules May Overshadow Tougher Capital Thresholds

Banks may face greater difficulty complying with minimum liquidity rules drawn up by global regulators than they will meeting higher capital requirements .

The Basel Committee on Banking Supervision , which meets in the Swiss city tomorrow, plans to discuss how to implement rules designed to ensure banks hold enough easy-to-sell assets to survive a 30-day credit squeeze and can back up long-term lending with stable sources of funds.

“The way the liquidity ratios are designed at the moment is going to cause a lot of banks a lot of problems,” said Monika Mars, a PricewaterhouseCoopers AG director in Zurich. “Liquidity is a much bigger challenge” for banks than meeting Basel capital rules, especially for smaller lenders and those in emerging markets, she said.

The liquidity rules are part of the last year’s Basel III deal to bolster the defenses of the world’s financial system by more than tripling the amount of core capital that banks have to hold. This week’s talks will also examine capital surcharges for banks whose failure would create turmoil across the globe. HSBC Holdings Plc (HSBA) , Citigroup Inc. (C) and Deutsche Bank AG (DBK) are among lenders facing the highest levy, Morgan Stanley (MS) analysts said in a June 19 note.

Regulators at the Basel meeting are set to discuss how to fulfil a commitment made last year to review and possibly adjust the two liquidity standards before they enter into force.

The ratios have triggered unease among some banks and regulators for risking unintended consequences for some lenders that have to work hard to meet Basel III’s demands.

“If you struggle with the capital rules you risk a much greater struggle with the liquidity requirements,” said Jesper Berg, senior vice president at Denmark ’s biggest mortgage bank, Nykredit A/S.

The Basel capital and liquidity requirements may combine to form a vicious circle, Berg said, as banks that sail too close to minimum permissible levels of capital might appear weak to the market, and so struggle to attract the depositors and investors they need to meet the liquidity rules.

The liquidity coverage ratio, or LCR, is the first one scheduled to be implemented. The measure, to be phased in by 2015, requires banks to hold enough assets that can be sold under stressed market conditions. The idea is to enable a lender to survive a crisis situation in which credit lines are withdrawn and the bank faces a sudden outflow of deposits.

The Senate chairman's partiality by Anusha Rahman Khan | Columnspk ...

Columnspk.com is your source for the Pakistani English Newspaper Columns, Articles, Editorials, Special and Investigative Reports, Breaking News, Top Stories, Events in Pakistan, World News, News on South Asia, News on America, News on Middle East Analysis, Political News and Views from Dawn, TheNews, Express Tribune, TheNation and Other National and International English Newspapers at one place. In 2009 I published an article that analysed whether formation of an independent block comprising a majority of the members of a parliamentary party attracts “defection” in accordance with Article 63A of the Constitution, which clearly provides reference to two terms that are distinctly used: “political party” and “parliamentary party.” “Parliamentary party” means all those members of a political party who stand elected to the assembly as nominees of a political party or independents who have subsequently become members of the parliamentary party by declaration in writing. Under Article 63A(1)(b), a member deserves disqualification on grounds of defection if he “votes or abstains from voting in the House contrary to any direction issued by the Parliamentary Party to which he belongs, rather than any direction issued by a single individual such as the ‘Leader of the Opposition’ or ‘Political Party’ or ‘Leader of the Political Party’ or some ‘Hidden Hand.’ “ On the issue raised in the case of Sen Ishaq Dar’s running for the position of leader of the opposition in the Senate, the Senate chairman’s line of reasoning in his order dated June 6, 2011, was that “since the PML-Q has joined the government, their members cannot support a member contesting the slot of the leader of the opposition in the Senate. Thus there are only 15 members supporting Muhammad Ishaq Dar.” This is flawed ab initio and unsustainable, and hence rendered without jurisdiction and coram non judice (not before the proper tribunal), as a vested constitutional right to vote cannot be disfranchised and the question of determination of the “opposition leader” is not contingent on party affiliations but depends on “members in opposition to the government.” This is evident from the following: The Constitution does not prohibit any senator from sitting in the opposition. The Senate Secretariat’s own record shows that before notifying the office of the leader of the opposition, which fell vacant on May 22, the chairman of the Senate had allowed the nine PML-Q senators to retain seats on opposition benches by acceding to their request, in the full knowledge that Article 63A is not applicable to Senate members. For the determination of the leader of the opposition, the electoral college consists of those members of the Senate who opt to oppose the treasury benches. Having allowed nine PML-Q senators as members of the opposition by his own ruling, the chairman could not have ignored their expression of support for Sen Ishaq Dar contesting for the position of leader of the opposition. Instead, the chairman decided to unconstitutionally disenfranchise these 25 percent of the 35 senators, who constituted “members in opposition to the government,” for determination of the leader of the opposition. As is evident from the record available with the Senate Secretariat, independent members who had cast their votes in favour of Maulana Haideri had declared their allegiance with the government and sat on government benches since 2009. It was on the very day the order was given in favour of Maulana Haideri that the chairman regarded their status as “independent” from what was throughout maintained by the Senate Secretariat as “alliance with government benches.” This cheating, fraud and forgery is tantamount to a criminal act punishable under the provisions of the Pakistan Penal Code. The partiality of the chairman of the Senate becomes more evident in his order of June 6, when he, on his motion and without any such requirement provided for in the rules, describes the JUI-F as being the “single-largest party in the opposition in the Senate having the strength of 12 members.” According to the record maintained with the Election Commission of Pakistan, the JUI has a strength of ten members and, according to the records of the Senate Secretariat, two independent members are allied with the JUI. According to the rules of Senate, the “largest party” principle is not applicable to the Senate. Additionally, when it comes to counting the votes of other independent members having declared alliance with the government, the chairman conveniently ignored that status, and as such maliciously disregarded the Senate record, to facilitate the appointment of Maulana Haideri as “leader of the opposition.” The chairman thus exceeded his jurisdiction by exercising powers not rooted in Constitution or validly made rules; in fact, he defied and violated the Constitution and conventions that require him to be neutral and impartial in the discharge of his functions. He is therefore liable to removal from office as well as membership of the Senate for stripping himself of the qualification for being “ameen” or “honest” under Article 62 (f). The chairman acted with partiality to facilitate the election of Maulana Haideri; for which he not only distorted his own oath but also Article 63A. That is tantamount to subversion of the Constitution, which is punishable under Article 6 of the Constitution. He therefore deserves to be deprived of his continued membership of the Senate by the Election Commission. Senator Ishaq Dar contested the election for leader of the opposition as a nominee of senators from all opposition, except the JUI-F. On May 2, within a few hours of the US raid in Abbottabad, the remaining groups of the PML-Q led by the Chaudhrys of Gujrat decided to rejoin the PPP-led NRO-based political alliance of convenience. As a result, on May 4 and 20. respectively, a sub-group of nine PML-Q members requested and were allowed to retain their seats on the opposition benches under the chairman’s ruling. Therefore, to suggest that the PML-N “managed to entice ten senators away from their parent parties” is laughable, since the Like-Minded Group was formed immediately after the February 2008 election and the position of leader of the opposition in the Senate became vacant only on May 2, 2011. Similarly, the PML-Q Unification Block in the Punjab Assembly was formed within days of the Feb 18 election. Within one month its membership had reached 20 and by July it had swelled to 40. Despite the illegal disqualification of Shehbaz Sharif by the rubberstamp Doger Court and the illegal imposition of governor’s rule in February 2009, and despite lucrative offers from the PPP, the Unification Block did not switch parties. On Feb 2, 2011, 47 parliamentarians of the Unification Block practised their constitutional right and requested the Punjab Assembly speaker to declare them a parliamentary group. At no point did any member of the Unification Block violate the Constitution or switch parties. Instead, no legislators of Unification could be despatched en bloc, despite tempting offerings of gifts from the PPP, and in particular by some, whose illegal distribution of taxpayers’ money to the bar association has recently been taken note of by the auditor general of Pakistan.

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