Regulation Correspondent, Europe
Huw's Feed
Dec 20, 2013

Path to a stronger financial system still strewn with dangers

LONDON, Dec 20 (Reuters) – “What a week”, tweeted European
Union financial services chief Michel Barnier on Thursday after
securing an agreement on how to wind up failed banks without
making the region’s taxpayers foot the bill.

The deal, hammered out after months of characteristic
wrangling, brings Europe a step closer to the banking union seen
as vital to avoid another contagious financial crisis and offers
some Christmas cheer to policymakers needing some victories to
present to recession-weary electorates.

Dec 20, 2013

EU banks watchdog says lenders ahead of liquidity rule

LONDON, Dec 20 (Reuters) – The European Union’s top banks
hold on average bigger cash-like buffers than required though
some specialised lenders should get some leeway, the bloc’s
banking watchdog said on Friday.

Banks will have to hold a so-called liquidity buffer made up
of top quality assets akin to cash, such as government bonds,
that can be sold easily so that lenders can withstand short-term
shocks unaided by taxpayers.

Dec 20, 2013

Accountants Grant Thornton says new EU rules spurring competition

LONDON, Dec 20 (Reuters) – European Union rules agreed this
week to increase competition in accounting are already being
felt two years before they take effect, accountants Grant
Thornton International said.

The EU’s new law from 2016 will force 35,000 companies
across the 28-country bloc to switch accountants about every ten
years to avoid overly cosy-relationships.

Dec 19, 2013

UK watchdog fines EY over audit of failed Christmas club

LONDON, Dec 19 (Reuters) – Britain’s accounting watchdog has
fined EY 750,000 pounds ($1.2 million) for failing to meet
required standards in its auditing of Christmas savings club
Farepak Food and Gifts, which ceased trading in 2006 owing money
to over 100,000 customers.

The Financial Reporting Council (FRC) also formally
reprimanded EY and ordered it to pay 425,000 pounds in costs.

Dec 19, 2013

Regulators to soften rules to help revive securitisation

LONDON, Dec 19 (Reuters) – Global regulators have softened
proposed new rules for securitisation in a bid to help to kick
start a financing method tarnished by the financial crisis.

Central bankers and policymakers see securitisation, or
packaging loans into bonds, as an important source of funding
for the wider economy.

Dec 18, 2013

EU banking watchdog to tackle risk pricing variations

LONDON, Dec 18 (Reuters) – The European Union’s banking
watchdog is to meet national supervisors, in an attempt to iron
out wide differences in how banks price risk and end any
competitive advantage some may gain from having less rigorous
in-house systems.

Announcing plans for the meetings on Wednesday, the European
Banking Authority (EBA) published several reports highlighting
wide variations in how banks across the 28-country bloc assess
the risks on their books, giving it ammunition to take action in
the course of next year.

Dec 17, 2013

EU in preliminary deal on audit market shake-up

LONDON (Reuters) – The European Union has reached a deal on forcing companies to periodically change accountants, as the bloc aims to improve book-keeping quality in the wake of the financial crisis.

The EU hopes a requirement for companies to regularly switch auditors will break up too-cozy relationships, increase competition between accountants and help avoid a repeat of the 2007-2009 crisis, which resulted in the bailout of banks given a clean bill of health by their auditors only months earlier.

Dec 17, 2013

New Basel study confirms variations in how banks tot up risks

LONDON (Reuters) – Global banking regulators have reinforced their campaign to impose more consistent ways for banks to assess risks on their trading books with a second finding of wide variations between systems in use in the sector.

The Basel Committee said on Tuesday a review of how lenders assign risk weightings to more complex trading positions showed big differences, reflecting the in-house models that banks use for their calculations.

Dec 16, 2013

‘Doom loop’ tying European banks and governments reinforced

LONDON (Reuters) – European banks have filled their balance sheets with national debt since 2011, bringing them easy profits but reinforcing a “doom loop” linking weak banks to governments with shaky finances.

The euro zone debt crisis showed banks can suffer big losses from holdings of their own countries’ bonds, which in turn can torpedo state finances if banks need to be bailed out.

Dec 13, 2013

Bankers get some breathing space over EU bonus cap

LONDON (Reuters) – Bankers in the European Union earning more than 500,000 euros a year may be excluded from a cap on their bonuses if they are not major risk takers, according to a revised rule from the EU’s banking watchdog on Friday.

Faced with public anger at banking excess, the EU approved a cap on bankers’ bonuses, limiting them to no more than their annual salary, or double that amount with shareholder approval. The cap will take effect on bonuses awarded for performance in 2014 and handed out in early 2015.

    • About Huw

      "Huw is based in London and covers European regulatory issues and global rulemaking bodies such as the G20, Financial Stability Board, IOSCO, IASB and the Basel Committee. He has covered EU regulation in Brussels, the emergence pan-European stock markets, and has also been a Wall Street reporter in New York."
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