Financial Regulatory Forum

By Huw Jones and Krista Hughes

LONDON/BASEL, Switzerland, March 8 (Reuters) – European Union finance ministers will discuss next week how to dampen speculation on sovereign credit default swap markets, sources said, as central bankers worry some selling practices pose wider risks.

Greek debt has come under pressure as the country seeks to tackle a ballooning deficit and some politicians say speculators using CDSs, intended to insure against any risk of debt defaults, are amplifying the country’s problems.

“The European Commission may bring forward an initiative at the 16 March Ecofin,” an EU diplomat said.

A senior trading official expects the Commission to say it is studying CDS trading rather than bringing in an immediate ban on “naked” selling of CDS, where the buyer of a contract does not own any of the underlying asset it insures.

Financial Stability Board Chairman, Mario Draghi, said greater regulation would be the natural outcome.

By John O’Donnell

BRUSSELS, Jan 19 (Reuters) – Sweden’s finance minister called on European counterparts to follow U.S. President Barack Obama’s lead with a bank tax to recoup the cost of propping up the industry but the idea received a guarded response.

Obama proposed last week that Wall Street pay up to $117 billion via a special levy to reimburse taxpayers for the financial bailout, saying “fat cat” bankers were making massive profits and “obscene” bonuses.

“We cannot accept a situation where the bankers are running away from the bill,” Sweden’s Anders Borg said on Tuesday at a meeting of European Union finance ministers, outlining his ideas for a bank tax or levy based on that in the U.S. and Sweden.

   By Huw Jones
LONDON, Nov 4 (Reuters) – Britain said on Wednesday it expects a satisfactory deal on setting up new European Union watchdogs for banks even though a key decision by the bloc’s finance ministers is less than a month away.

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