Financial Regulatory Forum

from Funds Hub:

Pensioners totter to the rescue

It may look like an unlikely scenario on paper, but Europe's elderly masses could be about to provide the killer blow to draft EU rules to regulate the alternative investment industry.

Hedge fund associations, private equity lobbyists, the British government and even the United States Treasury have waded into the debate over the proposed legislation, seeking to soften an approach which has been labelled an exercise in post-financial crisis political grandstanding, rather than a measured look at how to better regulate the sector.

Hedge fund crusaders?Now though, the pension funds have entered the stage, and their concerns will be far more likely to win over MEPs across the politcal spectrum.

The giant schemes have pushed more and more retirement money into alternatives as they seek to diversify their portfolios and find the kind of returns that can cushion the effects of pensioners -- eventually you and I -- living long enough to drain the coffers dry.

They have been stung into action by the possibility that their pursuit of profit to pay future liabilities could be derailed by measures likely to remove non-EU competition from the funds marketplace, while loading punitive additional expenses on the funds that remain. 

In China, banks chafe at derivatives drive

By Eadie Chen and Jonathan Leff
BEIJING/SINGAPORE, July 27 (Reuters) – While Washington pursues a high-profile overhaul of its derivatives markets, a more modest but equally important crackdown is underway in China. (more…)

Aided banks may face asset sale under new EU rules

European Commissioner for Competition Neelie Kroes    By Foo Yun Chee and Huw Jones
   BRUSSELS/LONDON, July 16 (Reuters) – Crisis-hit banks seeking European Union regulatory approval for state aid may have to sell assets and curb their market and geographical expansion, according to a draft EU document on bank restructuring rules. 

EU president Sweden vows quick action on crisis

By Julien Troyer
STRASBOURG, France, July 15 (Reuters) – European Union president Sweden promised on Wednesday to secure quick agreement on moves to tighten financial regulations to combat the economic crisis and on steps to fight climate change. (more…)

EU drafts sanctions for risky bonuses, tighter capital rules

Flags at EU Parliament
By Huw Jones
LONDON/BRUSSELS, July 13 (Reuters) – The European Union on Monday unveiled a new law that punishes banks who encourage too much risk-taking with their policies on pay, in an effort to put an end to the practices blamed for the credit crunch.
A draft law published by the European Commission tightens EU rules on bank capital and requires banks to improve disclosure of the holdings in securitised products, bidding to apply lessons from the worst financial crisis since the 1930s. (more…)

EU watchdogs unveil shortselling disclosure plans

    By Huw Jones
   LONDON, July 8 (Reuters) – European Union regulators unveiled draft plans on Wednesday to force short sellers of stocks to publicly disclose significant positions in a bid to crack down on those who abuse the market.

EU to unveil new banking reforms in October-FT

    LONDON, July 6 (Reuters) – New European Union laws designed to force banks to strengthen capital buffers will be unveiled in October, part of a regulatory drive stop a repeat of the global financial crisis, the Financial Times reported on Tuesday.

Fink: EU funds rules may spark regulatory war-FT

    LONDON, July 6 (Reuters) – The adoption of tough European Union restrictions on hedge funds could provoke a transatlantic regulatory war, one of the sector’s leading figures told the Financial Times newspaper in an interview.

Germany seeks to ease parts of Basel II capital rules

    By Marcin Grajewski and Huw Jones
   BRUSSELS/LONDON (Reuters) – Germany wants to relax global rules on capital charges to ease writedown pressures on banks holding toxic assets, an EU document showed on Wednesday.
   European Union finance ministers meet next week and will be asked to endorse a report from their Economic and Financial Committee on how to stop rules amplifying market turmoil. (more…)

EU derivatives plans focus on clearing

 Charlie McCreevy    By Huw Jones
   LONDON, July 1 (Reuters) – Centrally clearing the bulk of off-exchange derivatives contracts will be the core of Europe’s efforts to cut risk in the sector as further study is needed before forcing any trades onto exchanges, an EU document said.