ANALYSIS-EU, U.S. supervisors face derivatives test
By Huw Jones
LONDON, Sept 15 (Reuters) – Differences between new European Union and U.S. rules to crackdown on derivatives will be a key test of how well transatlantic regulators can coordinate to iron out loopholes banks may be tempted to exploit.
The United States has already approved a law to tighten supervision of the $615 trillion off-exchange derivatives markets and the EU published its own draft law on Wednesday.
Both implement pledges the EU and United States made as members of the Group of 20 countries (G20) to require central clearing of as many contracts as possible, reporting of trades to repositories and where appropriate, trading on an exchange.
“The crunch item to get right is for trade repositories to make sure every regulator has access to all the data they have,” said Damian Carolan, a partner at Allen & Overy law firm.
“I don’t think there are any massive showstopper obstacles and there is enough recognition for third country solutions,” Carolan added.
EU Internal Market Commissioner Michel Barnier is to meet his U.S. counterparts to ensure “we are operating in parallel”.
EU finance chiefs to discuss bank levy this week
By John O’Donnell BRUSSELS, April 13 (Reuters) – European finance ministers will attempt to settle differences over how best to impose extra taxes on banks at a meeting in Madrid this week, sources familiar with the talks said. (more…)
EU’s Barnier says will tackle short-selling
BRUSSELS, March 17 (Reuters) – The European Commission will crack down on “naked” selling and speculation in the market for credit default swaps with proposed controls as soon as June, the EU’s financial markets chief said on Wednesday. (more…)
Banks should hold more capital for risk -Santander
LONDON, Feb 23 (Reuters) – Spain’s Santander <SAN.MC>, Europe’s second biggest bank, said forcing banks to hold more capital to cover riskier activities would be better than forcing the break-up of big lenders. (more…)
Spain tightens proposed hedge fund rules
By Huw Jones LONDON, Feb 16 (Reuters) – European Union president Spain tightened proposed rules to regulate hedge funds and private equity groups, prompting accusations of protectionism from within the industry but potentially speeding up moves towards a deal. (more…)
from Global News Journal:
Brussels’ MEPs ready to duke it out with bankers
Every new year brings resolutions, and the European Parliament is no exception.
Often derided as a multi-lingual talking shop, the institution is feeling newly invigorated by some fresh faces and by the European Union's Lisbon reform treaty, which came into force late last year and gives the 736-member parliament more say in drafting laws and acting as a check on legislation.
Almost immediately, parliamentarians were letting their voice be heard, forcing Bulgaria to withdraw its nominee for the European Commission last month because she wasn't seen to be up to the job. They also look ready to block an agreement between the EU and the United States on sharing data on bank transfers, and are really beginning to show their teeth when it comes to financial sector reform.
It's one aspect of the latter move -- reported exclusively by Reuters on Monday -- which is set to cast MEPs in the role of banker-bashers-in-chief and could put them on a collision course with national governments.
Some senior MEPs are threatening to spoil a plan to set up new EU banking watchdogs because they believe the watchdogs' power has been watered down even before they've been set up by a deal struck among some finance ministers.
The watchdogs are supposed to keep tabs on the banking sector and the risks bankers take. But last December British chancellor Alistair Darling, worried about losing influence over the regulation of London, Europe's largest and richest financial centre, agreed a veto with other some other finance ministers.
The veto said that if the watchdogs issued a ruling that could have "fiscal consequences" for a country -- in other words, could end up costing taxpayers, and in Darling's case British taxpayers, money -- the ruling could be stayed.
Turkey plans to pass capital reforms by end-March
ISTANBUL, Dec 22 (Reuters) – Turkey plans to pass a European Union-sought capital markets reform bill through parliament before the end of March at the latest, the Capital Markets Board chairman said on Tuesday. (more…)
EU presses IMF over financial transaction tax
By David Brunnstrom and Timothy Heritage BRUSSELS, Dec 11 (Reuters) – The European Union increased pressure on the International Monetary Fund on Friday to consider a global tax on financial transactions to limit the risk of another economic crisis. (more…)
EU backs global financial transaction tax
By David Brunnstrom and Timothy Heritage
BRUSSELS, Dec 11 (Reuters) – The European Union urged the International Monetary Fund on Friday to pursue a global tax on financial transactions to limit the risk of another economic crisis, despite U.S. opposition.
EU leaders also underlined the need for “sound and effective” financial sector pay at a two-day summit but, with the notable exception of Germany, did not broadly support French and British proposals to tax bankers’ bonuses heavily.
Although the leaders of the 27-nation bloc largely revived existing ideas, they signalled a desire to address voters’ outrage over a return of the big bonus culture in the banking sector so soon after it was bailed out with tax payers’ money.
“The conclusion … is to propose a global financial transaction levy. It wouldn’t be fair that some impose very heavy burdens and others don’t,” Jose Manuel Barroso, president of the executive European Commission, told a news conference.
“I think it makes sense that a sector that created such a problem for our economies, our taxpayers … also makes a contribution to the overall economy,” he said after two days of talks in Brussels.
The IMF is already considering how to limit risk in the financial system after the worst economic crisis in generations, but Washington has opposed calls for a so-called Tobin Tax — named after U.S. economist James Tobin — on financial transactions.
EU clears revamp plans for Lloyds, ING, KBC
BRUSSELS, Nov 18 (Reuters) – Plans by three major European banks to sell chunks of their operations in return for state aid were approved by EU authorities on Wednesday, marking the latest regulatory-enforced financial break-ups. (more…)
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Why do you worry so much on arbitrage between countries when the financial regulators have imposed much more damaging risk arbitrage within the countries?
Basel III announced higher capital requirements but that when keeping the same risk-weights will only increase the arbitrary regressive regulatory discrimination against the small business.
A Sovereign rated triple-A will not be affected at all by higher capital requirements since being risk-weighted at zero means that zero on whatever higher is still zero.
Securities and borrowers rated triple-A, like those securities collateralized by lousily awarded mortgages to the subprime sector, and like AIG; and who are risk-weighted at only 20% will only be marginally affected.
But all those small businesses and entrepreneurs on whom we so much depend on for our next generation of jobs, because they are perceived as risky they are risk-weighted at 100% and will have to bear and pay for the full load of capital requirements.
With regulators like these of the Basel Committee, our chances of getting out of this crisis are meager indeed.
In due time financial history books will regard the Basel Accord and the perceived risk-phobia it brought on, as something absolute mindless from a financial regulatory aspect… but meanwhile what are we to do being stuck with the same growing-bigger-to-fail-bank, the same regulators and the same faulty paradigm.
I invite you all to a Kindergarten class on financial regulators that will make it easier for you to understand the disaster of having bank regulators that are fixated on seeing the gorilla in the room and have completely lost track of the ball. http://bit.ly/c66DLp
Per Kurowski
A former Executive Director at the World Bank (2002-2004)
http://subprimeregulations.blogspot.com/
http://www.theaaa-bomb.blogspot.com/