Financial Regulatory Forum

By John O’Donnell and Ilona Wissenbach

BRUSSELS, March 1 (Reuters) – Germany has taken steps to identify speculators in Greek debt to try to prevent them from profiting unduly from any bailout of the ailing euro zone economy, a source with direct knowledge of the matter told Reuters.

The probe by the country’s financial watchdog is part of delicate deliberations in Germany as to whether it should help bail out Greece, which is grappling with mounting debts.

“It would be bad if it were to emerge after a rescue that the money had gone into the pockets of speculators,” the source told Reuters.

“The result of the ‘Greek tragedy’ is that the political environment has become such that the Credit Default Swap (debt insurance) problem has come to the fore.”

The investigation by financial watchdog BaFin comes against a backdrop of concern over Greece’s ability to manage its finances, and sends a warning signal to speculators buying and selling insurance for Greek debt — a trading strategy that is legal but has been blamed for fuelling volatility.

By Sudip Kar-Gupta and Sumeet Desai

PARIS/LONDON, Dec 16 (Reuters) – France singled out frontline financial traders for a special 50 percent tax on bonuses, following Britain by tapping into public anger over the pay deals of bankers whom many blame for the financial crisis.

Britain plans to tax bonuses for all bankers, whether merger and acquisition specialists, credit providers or trading room stars, while the French moves announced on Wednesday are restricted to those trading financial instruments.

Both countries’ measures will apply above certain thresholds, with the French measure for instance targeting bonuses above 27,500 euros ($40,060).

PARIS, Oct 23 (Reuters) – France’s lower house of parliament on Friday approved a plan to impose a 10 percent tax on bank profits in 2010 despite opposition from the government.The National Assembly, adopted the opposition-proposed measure by 44 votes to 40.

However, a source in President Nicolas Sarkozy’s ruling UMP party said the government would ask for a new vote, claiming a technical problem because two UMP deputies had accidentally voted the wrong way.

There are 577 deputies in the lower house and President Nicolas Sarkozy’s centre-right UMP party has a comfortable majority but many were absent for the evening vote.

WASHINGTON, Sept 22 (Reuters) – Support grew on Tuesday for a U.S. plan to build a more balanced global economy and leaders warned against returning to business as usual once recovery takes hold.

British Prime Minister Gordon Brown said there was substantial support among the Group of 20 nations for creating a new framework aimed at shrinking surpluses in export-rich countries such as China and boosting savings in debt-laden nations including the United States.
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    PARIS, Sept 17 (Reuters) – France will not push for specific caps on bankers’ bonuses at next week’s meeting of leaders of the Group of 20 nations but wants clear restrictions, Economy Minister Christine Lagarde said in an interview on Thursday. (more…)

By Sumeet Desai and Anna Willard
LONDON, Sept 4 (Reuters) – World finance leaders shifted their focus from crisis fighting to banking reform on Friday as evidence mounted that the worst global recession in decades was finally drawing to a close.

U.S. Treasury Secretary Timothy Geithner called for tougher new bank capital requirements aimed at curbing some of the risky lending practices that have been blamed for the crisis, a position supported by another global banking powerhouse, Britain.

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By Anna Willard
PARIS, Sept 1 (Reuters) – France is optimistic about upcoming G20 meetings because many leaders, including British Prime Minister Gordon Brown, have moved closer to the French position, Economy Minister Christine Lagarde said.

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