06 May 2009

European Parliament adopted CRD II

European Parliament adopted the report on the review of the CRD introducing a 5% retention rate of the total value of the securitised exposures. A review clause calls on the Commission to present a proposal by 31 December 2009 if considered convenient.

The European Parliament adopted the report on the review of the CRD introducing a 5 % retention rate of the total value of the securitised exposures. A review clause calls on the Commission to present a proposal by 31 December 2009 if considered convenient after consulting the CEBS and taking into account international developments. The voted text has been agreed with the Council in first reading and will become effective from 31 December 2010.

 

 

The new legislation establishes colleges of supervisors to facilitate cooperation among national authorities dealing with cross-border financial institutions. MEPs also ask the Commission to put forward a legislative proposal to achieve further supervisory integration by 31 December 2009, with a view to establish an EU level supervisory system by 31 December 2011.

 

It also reinforces existing rules on the large exposure regime, including interbank trading. According to the agreed text, a bank would not be able to expose more than 25% of its own funds to a client or a group of clients. Exceeding this threshold will only be possible for exposure between credit institutions and for not more than Euro 150 million. A review clause was also agreed, as requested by the MEPs, on the large exposure regime by end of 2011, also to seek further harmonisation of national provisions.

With regard to Credit Default Swaps the text agreed calls on the Commission to put forward legislative proposals to enhance transparency in the OTC market and set up a central counterpart (CCP) or clearing house, supervised by the EU, by the end of 2009.

 

Finally, MEPs asked and obtained a review of rules on procyclicality, leverage and methodologies by the end of the current year.

 

EP Press release

Statement McCreevy

 

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