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SUMMARY RECOMMENDATIONS 1. One of the major lessons from the current financial crisis refers to the systemic dimension of financial risk which had been almost completely neglected by bankers and supervisors in the pre-2007 years. 2. Accordingly, the most needed change in financial regulation, in order to avoid a repetition of such a crisis in the future, consists of influencing individual bank behaviour such that systemic risk is decreased. This objective is new and distinct from what Basle II was intended to achieve. 3. It is important, therefore, to evaluate proposed new regulatory instruments on the ground of whether or not they contribute to a reduction, or containment of systemic risk. We see two new regulatory measures of paramount importance: the introduction of a Systemic Risk Charge (SRC), and the implementation of a transparent bank resolution regime. Both measures complement each other, thus both have to be realized to be effective. 4. We propose a Systemic Risk Charge (SRC), a levy capturing the contribution of any individual bank to the overall systemic risk which is distinct from the institution’s own default risk. The SRC is set up such that the more systemic risk a bank contributes, the higher is the cost it has to bear. Therefore, the SRC serves to internalize the cost of systemic risk which, up to now, was borne by the taxpayer. 5. Major details of our SRC refer to the use of debt that may be converted into equity when systemic risk threatens the stability of the banking system. Also, the SRC raises some revenues for government. 6. The SRC has to be compared to several bank levies currently debated. The Financial Transaction Tax (FTT) does not directly address systemic risk and is therefore inferior to a SRC. Nevertheless, a FTT may offer the opportunity to subsidize on-exchange trading at the expense of off-exchange (over-the-counter, OTC) transactions, thereby enhancing financial market stability. The Financial Activity Tax (FAT) is similar to a VAT on financial services. It is the least adequate instrument among all instruments discussed above to limit systemic risk. 7. Bank resolution regime: No instrument to contain systemic risk can be effective unless the restructuring of bank debt, and the ensuing loss given default to creditors, is a real possibility. As the crisis has taught, bank restructuring is very difficult in light of contagion risk between major banks. We therefore need a regulatory procedure that allows winding down banks, even large banks, on short notice. Among other things, the procedure will require to distinguish systemically relevant exposures from those that are irrelevant. Only the former will be saved with government money, and it will then be the task of the supervisor to ensure a sufficient amount of nonsystemically relevant debt on the balance sheet of all banks. 8. Further issues discussed in this policy paper and its appendices refer to the necessity of a global level playing field, or the lack thereof, for these new regulatory measures; the convergence of our SRC proposal with what is expected to be long-term outcome of Basle III discussions; as well as the role of global imbalances.

Content A. EXECUTIVE SUMMARY, INCLUDING MAJOR RECOMMENDATIONS B. COMPLETE REPORT 1. INTRODUCTION 2. RISK MAP 2.1 Why a Risk Map is needed, and for what purpose 2.1.1 Creating a unified data base 2.1.2 Assessing systemic risk 2.1.3 Allowing for coordinated policy action 2.2 Recommendations 3. GLOBAL REGISTER FOR LOANS (CREDIT REGISTER) AND BONDS (SECURITIES REGISTER) 3.1 Objectives of a credit register 3.2 Credit registers in Europe (and beyond) 3.3 Suggestions for a supra-national Credit Register 3.4 Integrating a supra-national Securities Register 3.5 Recommendations 4. HEDGE FUNDS: REGULATION AND SUPERVISION 4.1 What are hedge funds (activities, location, size, regulation)? 4.2 What are the risks posed by hedge funds (systematic risks, interaction with prime brokers)? 4.3 Routes to better regulation (direct, indirect) 4.4 Recommendations 5. RATING AGENCIES: REGULATION AND SUPERVISION 5.1 The role of ratings in bond and structured finance markets, past and present 5.2 Elements of rating integrity (independence, compensation and incentives, transparency) 5.3 Recommendations (registration, transparency, annual report on rating performance) 6. PROCYCLICALITY: PROBLEMS AND POTENTIAL SOLUTIONS 6.1 What is meant by “procyclicality” and why is it a problem? 6.2 The roots of procyclicality and the lessons it suggests for policymakers 6.2.1 Underpinnings of the phenomenon 6.2.2 Lessons to be learned 6.3 Characteristics of a macrofinancial stability framework 6.4 Recommendations 7. THE ROLE OF INTERNATIONAL INSTITUTIONS AND FORA, IN PARTICULAR THE IMF, BIS AND FSF 7.1 Legitimacy 7.2 Re-focusing the work 7.3 Recommendations

Background: Following acute coronary syndrome (ACS), the risk for future cardiovascular events is high and is related to levels of low-density lipoprotein cholesterol (LDL-C) even within the setting of intensive statin treatment. Proprotein convertase subtilisin/kexin type 9 (PCSK9) regulates LDL receptor expression and circulating levels of LDL-C. Antibodies to PCSK9 can produce substantial and sustained reductions of LDL-C. The ODYSSEY Outcomes trial tests the hypothesis that treatment with alirocumab, a fully human monoclonal antibody to PCSK9, improves cardiovascular outcomes after ACS. Design: This Phase 3 study will randomize approximately 18,000 patients to receive biweekly injections of alirocumab (75-150 mg) or matching placebo beginning 1 to 12 months after an index hospitalization for acute myocardial infarction or unstable angina. Qualifying patients are treated with atorvastatin 40 or 80 mg daily, rosuvastatin 20 or 40 mg daily, or the maximum tolerated and approved dose of one of these agents and fulfill one of the following criteria: LDL-C ≥ 70 mg/dL, non-high-density lipoprotein cholesterol ≥ 100 mg/dL, or apolipoprotein B ≥ 80 mg/dL. The primary efficacy measure is time to first occurrence of coronary heart disease death, acute myocardial infarction, hospitalization for unstable angina, or ischemic stroke. The trial is expected to continue until 1613 primary end point events have occurred with minimum follow-up of at least 2 years, providing 90% power to detect a 15% hazard reduction. Adverse events of special interest include allergic events and injection site reactions. Interim analyses are planned when approximately 50% and 75% of the targeted number of primary end points have occurred. Summary: ODYSSEY Outcomes will determine whether the addition of the PCSK9 antibody alirocumab to intensive statin therapy reduces cardiovascular morbidity and mortality after ACS.

Autism spectrum disorder (ASD) is a highly heritable disorder of complex and heterogeneous aetiology. It is primarily characterized by altered cognitive ability including impaired language and communication skills and fundamental deficits in social reciprocity. Despite some notable successes in neuropsychiatric genetics, overall, the high heritability of ASD (~90%) remains poorly explained by common genetic risk variants. However, recent studies suggest that rare genomic variation, in particular copy number variation, may account for a significant proportion of the genetic basis of ASD. We present a large scale analysis to identify candidate genes which may contain low-frequency recessive variation contributing to ASD while taking into account the potential contribution of population differences to the genetic heterogeneity of ASD. Our strategy, homozygous haplotype (HH) mapping, aims to detect homozygous segments of identical haplotype structure that are shared at a higher frequency amongst ASD patients compared to parental controls. The analysis was performed on 1,402 Autism Genome Project trios genotyped for 1 million single nucleotide polymorphisms (SNPs). We identified 25 known and 1,218 novel ASD candidate genes in the discovery analysis including CADM2, ABHD14A, CHRFAM7A, GRIK2, GRM3, EPHA3, FGF10, KCND2, PDZK1, IMMP2L and FOXP2. Furthermore, 10 of the previously reported ASD genes and 300 of the novel candidates identified in the discovery analysis were replicated in an independent sample of 1,182 trios. Our results demonstrate that regions of HH are significantly enriched for previously reported ASD candidate genes and the observed association is independent of gene size (odds ratio 2.10). Our findings highlight the applicability of HH mapping in complex disorders such as ASD and offer an alternative approach to the analysis of genome-wide association data.