CESR’s 2007 report on Credit Rating Agencies

CESR published the responses to the questions it asked for additional information to the four CRAs which have agreed to be part of CESR’s voluntary framework.

IASB revised proposals for determining cost of investment in separate financial statements

The IASB published an exposure draft of proposed amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards and IAS 27 Consolidated and Separate Financial Statements. Deadline for consultation is 26 February 2008.

CESR overview of language requirements of Prospectus

CESR issued an overview of language requirements for the vetting of Prospectus across the EU and a summary of CESR Members requirements regarding the translation of the ‘Summary Prospectus’.

CESR starts work on Employee Share Scheme Prospectuses

The Commission is requesting regulators to adopt a common light-touch approach under the Prospectus Directive and Regulation for offers to employees. CESR intends to analyse the possibility to agree a short-form disclosure regime. Deadline for comments is 31 January 2008.

IASB guidance on group cash-settled share-based payment arrangements

The IASB published an exposure draft of proposed amendments to IFRS 2 Share-based Payment and IFRIC 11 IFRS 2— Group and Treasury Share Transactions. Deadline for comments is 17 March 2008.

Signing ceremony of the Treaty of Lisbon

The reform treaty will be signed in Lisbon on 13 December 2007. "With the Treaty of Lisbon Europe finally overcomes the political and institutional impasse that limited its capacity to act during the last few years", Jose Socrates, Portuguese Prime-Minister, said at the signing ceremony.

Commission encourages swift and coherent implementation of PSD

The Commission is to assist Member States in their implementation of the Payment Services Directive, which has now to be written into national law by 1 November 2009 at the latest. In particular, the Commission will set up best-practice workshops and an interactive question-and-answer website.

Nason remarks on redesigning U.S. Financial Regulation

The European Commission's proposal of a new Solvency II legislation are impacting how we in the United States view our insurance regulatory structure, US-Treasury Assistant Secretary David Nason said before the City of London Corporation. “The NAIC is currently considering updates to the U.S. risk-based capital and re-insurance policies”, he said.

Signature of the Charter of Fundamental Rights

The Presidents of the European Commission, European Parliament, and the Council signed and solemnly proclaimed the Charter of Fundamental Rights of the European Union in Strasbourg, thus opening the way for the signing of the Treaty of Lisbon tomorrow.

Single Market News No 48

The Commission issued its latest Single Market News with a special feature on consumer benefits targeted in new Single Market strategy. It also covers an overview on the EU policy responses to the recent financial market turbulence.

Central Banks announce measures to address elevated pressures in short-term funding markets

The US FED together with the Bank of Canada, the Bank of England, the European Central Bank, and the Swiss National Bank are announcing measures designed to address elevated pressures in short-term funding markets.

Earnings warning issued as Fitch fears credit crunch will roll into 2008

European banks face a "considerably more challenging year" in 2008, and credit-market turmoil, which triggered about $76bn in writedowns at securities firms, will last through the first quarter, ratings agency Fitch said.

EFBS calls IMCO vote on Consumer Credit ‘absurd’

The EFBS criticises the recommendations of the Internal Market Committee as absurd and probably leading to price increases. The EFBS criticizes that Credit institutions had to provide the consumer pre-contractual information by way of handing over a minimum 10 sheeted standard information form.

NYSE inaugurates Beijing office

The NYSE officially inaugurated its Beijing office on Tuesday. NYSE was the first foreign exchange to receive approval from the Chinese government to open a representative office in China.

FT column: Why the credit squeeze is a turning point for the world

In his FT column, Martin Wolf writes that the credit crisis is a major turning point for the world economy on a scale as big as the emerging market crises in the late 1990s and the dotcom bubble. He cites eight reasons, such as the likelihood of a US recession, the emergence of crony capitalism, insufficient regulation, and most important of all, a huge blow to the Anglo-Saxon system of transaction-oriented financial capitalism.

Padoa-Schioppa: Europe needs a single financial rulebook

Comment: Last week the European Union finance ministers decided that co-operation in financial regulation and supervision should be strengthened. The recent financial turmoil has confirmed the shortcomings of the current system. The European supervisory function has been almost absent.

IMCO meeting (Strasbourg)

The EP Internal Market and Consumer Affairs Committee adopted the report on the Consumer Credit Directive. Some 236 amendments had been tabled. The political groups reached agreement before the vote on 10 compromise amendments covering some of these.

Credit crisis delaying liability hedging deals

The credit crisis is delaying the execution of derivatives-based liability hedging strategies for pension funds, Watson Wyatt warns. The consulting firm said that ISDA agreements and documentation required to execute such transactions are now taking significantly longer to process because they contain more onerous legal conditions than in the past.

BIS Quarterly Review December 2007

The BIS released its Quarterly Review presenting an overview of recent developments in financial markets, before turning in more detail to highlights from the latest BIS data on international banking and financial market activity. The review also contains five special feature articles, including one on international banking with the Euro.

PCAOB staff audit practice alert on Fair Value

The PCAOB published a staff audit practice alert on the audit of fair value measurements in financial statements. The alert provides auditors with additional information related to auditing fair value measurements and disclosures, as well as the use of specialists in this area.

Plenary Meeting 10-13 December

Parliament adopted the report of Christian Ehler on deposit guarantee schemes and of Wolf Klinz on Asset management II.

FT: Europe's new treaty is a threat to the City of London

How excited should the City be about the European Union reform treaty, which is due to be signed this week? The treaty redistributes powers in the EU in a way that will make it easier for EU institutions to influence the regulation of financial services.

Scale of shutdown in debt markets revealed

The full scale of the shutdown in debt markets around the world has been laid bare by figures showing that growth in corporate bond markets almost ground to a standstill in the late summer. The BIS reveals that companies in the UK have cut back on their borrowing at the fastest rate in over three years.

Commission consultation on IAS23/IFRIC12

The Commission Services are carrying out two Effect Studies in relation to the endorsement of revised IAS 23 Borrowing Costs and IFRIC 12 Service Concession Arrangements. Deadline for comments is 25 January 2008.

AMF amends insider lists established by issuers of financial instruments

AMF amends its position on the insider lists established by issuers of financial instruments. It provides a list of persons that no longer need to be included on the insider lists established by issuers.

EFBS criticizes US rescue plan as ‘conceptless’

The EFBS criticizes the US governments’ rescue plan for home owners that are threatened by foreclosure as ‘conceptless’. “The failure of the US American finance systems is a confession of failure that hopefully came early enough to definitely bury the plans of the European Commission to harmonise the EU mortgage markets”, the EFBS states.  

CEBS consultation on common definition on Tier 1 hybrids

CEBS consultation on second part of technical advice on large exposures

CEBS started a public consultation on a number of aspects of the large exposures regime as part of developing its response to the Commission's second call for advice. The consultation paper sets out CEBS' preliminary views and includes a summary of CEBS' key findings from Part 1 of its Advice. Deadline for comments is 22 February 2008.

Speech McCreevy: Making Europe work for Business

Speaking at the Bloomberg Business Lunch in London, Commissioner McCreevy announced the publication of the White Paper on mortgage credit in due course. “I do not believe the case for a directive has been made”, he said. The Commission will also come forward with a proposal on UCITS, starting the Inter-Service Consultation very early in the New Year.

Speech Sato: Global Financial Market Turmoil and its Policy Implications

Takafumi Sato, Commissioner of the Japanese Financial Services Agency, stated that the recent financial turmoil has not had a serious impact on the Japanese financial system. However, Mr Sato proposed to consider “rules or voluntary codes of conduct" requesting the disclosure of information on the portion kept by originators and arrangers.

Speech McCreevy: Financial Market Controversies

Commissioner McCreevy reiterated that he does not plan any regulation on Sovereign Wealth Funds. “We must not allow the discussion on SWFs to be used as an excuse to raise unjustified barriers to investment and the free movement of capital”, he said.

IOSCO final report on management of conflicts that arise in securities offerings

BaFin Journal 11/07

Comments received reports of MFEG and MICEG

The Commission published a feedback statement on the comments received on the reports of MFEG and MICEG. Industry representatives generally supported the recommendations and found the dialogue on the MICEG to be useful despite the fact it did not arrive at any definitive recommendations. Member States had reservations about the effectiveness of some recommendations.