Developing “Best Practices” for bankers’ pay in line with Basel III

This paper proposes hybrid capital securities as a significant part of senior bank executive incentive compensation in light of Basel III, a new global regulatory standard on bank capital adequacy and liquidity agreed by the members of the Basel Committee on Banking Supervision. The committee developed Basel III in a response to the deficiencies in financial regulation brought about by the global financial crisis. Basel III strengthens bank capital requirements and introduces new regulatory requirements on bank liquidity and bank leverage. The hybrid bank capital securities we propose for bank executives’ compensation are preferred shares and subordinated debt that the June 2004 Basel II regulatory framework recognised as other admissible forms of capital. The past two decades have witnessed dramatic increase in performance-related pay in the banking industry. Stakeholders such as shareholders, debtholders and regulators criticise traditional cash and equity-based compensation for encouraging bank executives’ excessive risk taking and short-termism, which has resulted in the failure of risk management in high profile banks during the global financial crisis. Paying compensation in the form of hybrid bank capital securities may align the interests of executives with those of stakeholders and help banks regain their reputation for prudence after years of aggressive risk-taking. Additionally, banks are desperately seeking to raise capital in order to bolster balance sheets damaged by the ongoing credit crisis. Tapping their own senior employees with large incentive compensation packages may be a viable additional source of capital that is politically acceptable in times of large-scale bailouts of the financial sector and economically wise as it aligns the interests of the executives with the need for a stable financial system.

Large is fast, small is tight: determinants of speed and affinity in subunit capture by a periplasmic chaperone

The chaperone/usher pathway assembles surface virulence organelles of Gram-negative bacteria, consisting of fibers of linearly polymerized protein subunits. Fiber subunits are connected through 'donor strand complementation': each subunit completes the immunoglobulin (Ig)-like fold of the neighboring subunit by donating the seventh β-strand in trans. Whereas the folding of Ig domains is a fast first-order process, folding of Ig modules into the fiber conformation is a slow second-order process. Periplasmic chaperones separate this process in two parts by forming transient complexes with subunits. Interactions between chaperones and subunits are also based on the principle of donor strand complementation. In this study, we have performed mutagenesis of the binding motifs of the Caf1M chaperone and Caf1 capsular subunit from Yersinia pestis and analyzed the effect of the mutations on the structure, stability, and kinetics of Caf1M-Caf1 and Caf1-Caf1 interactions. The results suggest that a large hydrophobic effect combined with extensive main-chain hydrogen bonding enables Caf1M to rapidly bind an early folding intermediate of Caf1 and direct its partial folding. The switch from the Caf1M-Caf1 contact to the less hydrophobic, but considerably tighter and less dynamic Caf1-Caf1 contact occurs via the zip-out-zip-in donor strand exchange pathway with pocket 5 acting as the initiation site. Based on these findings, Caf1M was engineered to bind Caf1 faster, tighter, or both faster and tighter. To our knowledge, this is the first successful attempt to rationally design an assembly chaperone with improved chaperone function.

Alternatives to Sedum on green roofs: Can broad leaf perennial plants offer better ‘cooling service’?

Green roof plants alter the microclimate of building roofs and may improve roof insulation. They act by providing cooling by shading, but also through transpiration of water through their stomata. However, leaf surfaces can become warmer when plants close the stomata and decrease water loss in response to drying substrate (typically associated with green roofs during summers), also reducing transpirational cooling. By using a range of contrasting plant types (Sedum mix – an industry green roof ‘standard’, Stachys byzantina, Bergenia cordifolia and Hedera hibernica) we tested the hypothesis that plants differ in their ‘cooling potential’. We firstly examined how leaf morphology influenced leaf temperature and how drying substrate altered that response. Secondly, we investigated the relationship between leaf surface temperatures and the air temperatures immediately above the canopies (i.e. potential to provide aerial cooling). Finally we measured how the plant type influenced the substrate temperature below the canopy (i.e. potential for building cooling). In our experiments Stachys outperformed the other species in terms of leaf surface cooling (even in drying substrate, e.g. 5 oC cooler compared with Sedum), substrate cooling beneath its canopy (up to 12 oC) and even - during short intervals over hottest still periods - the air above the canopy (up to 1 oC, when soil moisture was not limited). We suggest that the choice of plant species on green roofs should not be entirely dictated by what survives on the shallow substrates of extensive systems, but consideration should be given to supporting those species providing the greatest eco-system service potential.

Possible role of aerosol transmission in a hospital outbreak of influenza.

BACKGROUND: We examined the role of aerosol transmission of influenza in an acute ward setting. METHODS: We investigated a seasonal influenza A outbreak that occurred in our general medical ward (with open bay ward layout) in 2008. Clinical and epidemiological information was collected in real time during the outbreak. Spatiotemporal analysis was performed to estimate the infection risk among patients. Airflow measurements were conducted, and concentrations of hypothetical virus-laden aerosols at different ward locations were estimated using computational fluid dynamics modeling. RESULTS: Nine inpatients were infected with an identical strain of influenza A/H3N2 virus. With reference to the index patient's location, the attack rate was 20.0% and 22.2% in the "same" and "adjacent" bays, respectively, but 0% in the "distant" bay (P = .04). Temporally, the risk of being infected was highest on the day when noninvasive ventilation was used in the index patient; multivariate logistic regression revealed an odds ratio of 14.9 (95% confidence interval, 1.7-131.3; P = .015). A simultaneous, directional indoor airflow blown from the "same" bay toward the "adjacent" bay was found; it was inadvertently created by an unopposed air jet from a separate air purifier placed next to the index patient's bed. Computational fluid dynamics modeling revealed that the dispersal pattern of aerosols originated from the index patient coincided with the bed locations of affected patients. CONCLUSIONS: Our findings suggest a possible role of aerosol transmission of influenza in an acute ward setting. Source and engineering controls, such as avoiding aerosol generation and improving ventilation design, may warrant consideration to prevent nosocomial outbreaks.

The coupled model predictability of the Western North Pacific summer monsoon with different leading times

Leading time length is an important issue for modeling seasonal forecasts. In this study, a comparison of the interannual predictability of the Western North Pacific (WNP) summer monsoon between different leading months was performed by using one-, four-, and seven-month lead retrospective forecasts (hindcasts) of four coupled models from Ensembles-Based Predictions of Climate Changes and Their Impacts (ENSEMBLES) for the period of 1960-2005. It is found that the WNP summer anomalies, including lower-tropospheric circulation and precipitation anomalies, can be well predicted for all these leading months. The accuracy of the four-month lead prediction is only slightly weaker than that of the one-month lead prediction, although the skill decreases with the increase of leading months.

Revisiting Asian monsoon formation and change associated with Tibetan Plateau forcing: I. Formation

Numerical experiments with different idealized land and mountain distributions are carried out to study the formation of the Asian monsoon and related coupling processes. Results demonstrate that when there is only extratropical continent located between 0 and 120°E and between 20/30°N and the North Pole, a rather weak monsoon rainband appears along the southern border of the continent, coexisting with an intense intertropical convergence zone (ITCZ). The continuous ITCZ surrounds the whole globe, prohibits the development of near-surface cross-equatorial flow, and collects water vapor from tropical oceans, resulting in very weak monsoon rainfall. When tropical lands are integrated, the ITCZ over the longitude domain where the extratropical continent exists disappears as a consequence of the development of a strong surface cross-equatorial flow from the winter hemisphere to the summer hemisphere. In addition, an intense interaction between the two hemispheres develops, tropical water vapor is transported to the subtropics by the enhanced poleward flow, and a prototype of the Asian monsoon appears. The Tibetan Plateau acts to enhance the coupling between the lower and upper tropospheric circulations and between the subtropical and tropical monsoon circulations, resulting in an intensification of the East Asian summer monsoon and a weakening of the South Asian summer monsoon. Linking the Iranian Plateau to the Tibetan Plateau substantially reduces the precipitation over Africa and increases the precipitation over the Arabian Sea and the northern Indian subcontinent, effectively contributing to the development of the South Asian summer monsoon.

Allosteric mechanism controls traffic in the chaperone/usher pathway

Many virulence organelles of Gram-negative bacterial pathogens are assembled via the chaperone/ usher pathway. The chaperone transports organelle subunits across the periplasm to the outer membrane usher, where they are released and incorporated into growing fibers. Here, we elucidate the mechanism of the usher-targeting step in assembly of the Yersinia pestis F1 capsule at the atomic level. The usher interacts almost exclusively with the chaperone in the chaperone:subunit complex. In free chaperone, a pair of conserved proline residues at the beginning of the subunit-binding loop form a ‘‘proline lock’’ that occludes the usher-binding surface and blocks usher binding. Binding of the subunit to the chaperone rotates the proline lock away from the usher-binding surface, allowing the chaperone-subunit complex to bind to the usher. We show that the proline lock exists in other chaperone/usher systems and represents a general allosteric mechanism for selective targeting of chaperone:subunit complexes to the usher and for release and recycling of the free chaperone.

Review of R&D progress and practical application of the solar photovoltaic/thermal (PV/T) technologies

In this paper, the global market potential of solar thermal, photovoltaic (PV) and combined photovoltaic/thermal (PV/T) technologies in current time and near future was discussed. The concept of the PV/T and the theory behind the PV/T operation were briefly introduced, and standards for evaluating technical, economic and environmental performance of the PV/T systems were addressed. A comprehensive literature review into R&D works and practical application of the PV/T technology was illustrated and the review results were critically analysed in terms of PV/T type and research methodology used. The major features, current status, research focuses and existing difficulties/barriers related to the various types of PV/T were identified. The research methods, including theoretical analyses and computer simulation, experimental and combined experimental/theoretical investigation, demonstration and feasibility study, as well as economic and environmental analyses, applied into the PV/T technology were individually discussed, and the achievement and problems remaining in each research method category were described. Finally, opportunities for further work to carry on PV/T study were identified. The review research indicated that air/water-based PV/T systems are the commonly used technologies but their thermal removal effectiveness is lower. Refrigerant/heat-pipe-based PV/Ts, although still in research/laboratory stage, could achieve much higher solar conversion efficiencies over the air/water-based systems. However, these systems were found a few technical challenges in practice which require further resolutions. The review research suggested that further works could be undertaken to (1) develop new feasible, economic and energy efficient PV/T systems; (2) optimise the structural/geometrical configurations of the existing PV/T systems; (3) study long term dynamic performance of the PV/T systems; (4) demonstrate the PV/T systems in real buildings and conduct the feasibility study; and (5) carry on advanced economic and environmental analyses. This review research helps finding the questions remaining in PV/T technology, identify new research topics/directions to further improve the performance of the PV/T, remove the barriers in PV/T practical application, establish the standards/regulations related to PV/T design and installation, and promote its market penetration throughout the world.

Pocket data mining: towards collaborative data mining in mobile computing environments

Pocket Data Mining (PDM) is our new term describing collaborative mining of streaming data in mobile and distributed computing environments. With sheer amounts of data streams are now available for subscription on our smart mobile phones, the potential of using this data for decision making using data stream mining techniques has now been achievable owing to the increasing power of these handheld devices. Wireless communication among these devices using Bluetooth and WiFi technologies has opened the door wide for collaborative mining among the mobile devices within the same range that are running data mining techniques targeting the same application. This paper proposes a new architecture that we have prototyped for realizing the significant applications in this area. We have proposed using mobile software agents in this application for several reasons. Most importantly the autonomic intelligent behaviour of the agent technology has been the driving force for using it in this application. Other efficiency reasons are discussed in details in this paper. Experimental results showing the feasibility of the proposed architecture are presented and discussed.

Distributed hoeffding trees for pocket data mining

Collaborative mining of distributed data streams in a mobile computing environment is referred to as Pocket Data Mining PDM. Hoeffding trees techniques have been experimentally and analytically validated for data stream classification. In this paper, we have proposed, developed and evaluated the adoption of distributed Hoeffding trees for classifying streaming data in PDM applications. We have identified a realistic scenario in which different users equipped with smart mobile devices run a local Hoeffding tree classifier on a subset of the attributes. Thus, we have investigated the mining of vertically partitioned datasets with possible overlap of attributes, which is the more likely case. Our experimental results have validated the efficiency of our proposed model achieving promising accuracy for real deployment.

Distributed classification for pocket data mining

Distributed and collaborative data stream mining in a mobile computing environment is referred to as Pocket Data Mining PDM. Large amounts of available data streams to which smart phones can subscribe to or sense, coupled with the increasing computational power of handheld devices motivates the development of PDM as a decision making system. This emerging area of study has shown to be feasible in an earlier study using technological enablers of mobile software agents and stream mining techniques [1]. A typical PDM process would start by having mobile agents roam the network to discover relevant data streams and resources. Then other (mobile) agents encapsulating stream mining techniques visit the relevant nodes in the network in order to build evolving data mining models. Finally, a third type of mobile agents roam the network consulting the mining agents for a final collaborative decision, when required by one or more users. In this paper, we propose the use of distributed Hoeffding trees and Naive Bayes classifers in the PDM framework over vertically partitioned data streams. Mobile policing, health monitoring and stock market analysis are among the possible applications of PDM. An extensive experimental study is reported showing the effectiveness of the collaborative data mining with the two classifers.