Speech McCreevy: Striving for a Single European Market - The role of accounting

Speaking at the Congress of German Public Auditors in Berlin, Commissioner McCreevy reviewed the progress and forthcoming issues in auditing and accounting. “Before the end of this year, my services will launch a study on the costs and benefits of introducing International Standards for Auditins as well as any potential differences with US standards”, the Commissioner said.

IOSCO launches tasks force on recent market events

The IOSCO announced the creation of a dedicated Task Force on the subprime crisis. “The issues facing securities regulators can no longer simply be viewed in a national context”, Michel Prada, Chairman of IOSCO’s Technical Committee, said.

IOSCO appoints new Secretary General

IOSCO appointed Greg Tanzer as its new Secretary General, and will take up his position in January 2008.  "Greg has an extensive background in domestic regulation and international regulatory co-operation throughout his career at the Australian Securities and Investments Commission”, Jane Diplock, Chairperson of IOSCO, said.

CESR report on implementation and enforcement of IFRS

CESR published a report on the implementation and enforcement of IFRS in the EU. It provides among others a record of European enforcers’ experience with the enforcement of IFRS standards during the first year of their compulsory use in the consolidated accounts of EU listed issuers.

UK Treasury rejectes pan-European regulator for financial services

Economic Secretary and City Minister Kitty Ussher rejected a one-size-fits-all regulatory approach or pan-European regulator for financial services, saying that either would not have the flexibility needed to allow EU markets to prosper.

General Regulation of the AMF

The AMF issued its General Regulations on Book III - Service Providers, and Book V – Market Infrastructures, in force as from 1 November 2007. It also released a modified Instruction on disclosure requirements for public offerings.

New European card schemes to facilitate pan-European card payments

Six European card payment schemes have joined together to establish the Euro Alliance of Payment Schemes. Pan-European transactions under the Alliance will take place before the SEPA deadline of January 2008. Direct paricipation by banks will be possible later in 2008.

UK discussion paper on Lamfalussy review

The UK Treasury and the FSA issued a discussion paper on the review of the Lamfalussy arrangements. Overall the UK authorities believe the Lamfalussy arrangements are structurally sound. They recommend among others a package of measures to further develop group-based approaches to supervision.

Combined statement on governance of IASC Foundation

In a combined statement the European Commission, the Financial Services Agency of Japan, IOSCO and the US SEC proposed changes to strengthen the institutional framework of the International Accounting Standards Committee (IASC) Foundation.  "We have a common interest of ensuring continuing user confidence in the institutions responsible for the development of global accounting standards”, the organisations declared.

AMF clarifies conditions for investment services providers from Member States not having transposed MiFID

The AMF outlined the conditions applicable in France to investment services providers from Member States that have not transposed the provisions of the MiFID Directive and its implementing directive within the requisite timeframes. 

CEBS first part of advice on large exposures

CEBS published the first part of its response to the Commission's Call for Advice on the review of the large exposures regime. CEBS concludes that a limits-based “backstop” regime is the most appropriate regulatory tool and that the current regime has some shortcomings that need to be addressed.

IASB: Trustees announce strategy to enhance governance

The Trustees of the International Accounting Standards Committee (IASC) Foundation announced proposals to enhance the organisation’s governance arrangements and reinforce the organisation’s public accountability. The Trustees will begin a series of consultations with key stakeholders on these proposals in the build up to the Constitution Review, which is scheduled to start in 2008.

CEIOPS consultation on General Protocol on collaboration of insurance supervisory authorities

CEIOPS issued a consultation paper on the General Protocol relating to the collaboration of the insurance supervisory authorities in the EU. The Protocol applies to the authorities of the Member States of the EU competent for the supervision of insurance and reinsurance undertakings. Deadline for comments is 5 February 2008.

CEIOPS proposal on freedom of services under IMD

CEIOPS issued an extensive analysis of different proposals for defining cross-border services under the Insurance Mediation Directive. The analysis presents three different options expressed by the members of its Intermediaries Expert Group.

French firms subscribe to Avox MiFID classification service

French firms Calyon, CM CIC Securities and Société Général Corporate and Investment Banking have signed up to the MiFID classification service provided by Deutsche Börse subsidiary Avox.

IMCO meeting 5 November

CESR timetable on review of role of Credit Rating Agencies

CESR released its timetable on the review the role of Credit Rating Agencies. A consultation periode is foreseen for February 2008. The final report to the Commission will be published in May 2008.

ECON meeting 5 November

ECON Committee discussed the report on asset management and voted on a number of reports.

CEBS summary of hearing on future of supervisory reporting

CEBS published the summary of the hearing on the future developments of supervisory reporting. Mr. Vossen introduced the tentative actions which CEBS would undertake in 2008. It was proposed to develop standardised remittance dates for the COREP reporting framework as well as standardised frequencies for COREP and FINREP reporting. The reactions from participants were mixed.

FT: Brussels threatens action against countries over Mifid breaches

Brussels plans to take tough action against European states that fail to implement the incoming Mifid in full, senior officials at the Commission have indicated. The Commission may even offer tacit support to financial institutions that want to sue European governments that have failed to implement the legislation on time, officials say.

BIS working paper on bank size, credit and the sources of bank market risk

The study examines bank risk by investigating the equity and loan portfolio characteristics of publicly-traded bank holding companies. It finds that the reduced ability of small banks to diversify forces them to either pick borrowers whose assets have relatively low credit risk or make loans that are backed by relatively more collateral.

IPE: CEIOPS changes direction on Solvency II

The widely-criticised Solvency II directive may not be adopted for pension funds after all. CEIOPS has set up a steering committee to deal with solvency issues for pension funds. Klaas Knot, director of supervisory policy at the Dutch pension regulator DNB and newly-appointed to CEIOPS' managing, told IPE: “It is not being discussed that Solvency II, as such, will be applied to pension funds lock, stock and barrel.

The Economist: Costs of the credit crunch mount. There may be more pain to come

“THIS time it's different” are the four most expensive words in the English language, runs a saying among bankers. So it has proved at Merrill Lynch and other subprime mortgage-linked nasties. Never mind that most of its CDOs were “super senior” and supposed to be relatively safe. The mortgage crisis has done more than $27 billion-worth of damage to capital-market businesses fo far. 

CEIOPS protocol on mediation mechanism between Insurance and Pensions Supervisors

CEIOPS publishes its Protocol on Mediation Mechanism between Insurance and Pensions Supervisors. Potential areas where mediation could be useful to solve tensions or disputes include, processes for consultation between competent Authorities, processes of exchange of information, and processes for joint agreement or decision-taking among competent authorities

CESR IT systems and databases up and running

CESR announces that its network of transaction reporting systems (TREM) is working as of 1 November 2007. Three databases are accessible to users for full functioning of new market structures under the MiFID. CESR recognises that the list is incomplete and that it may take some time before the list will be complete.

FSA simplified regime for the conduct of investment business comes into force

The FSA’s new simplified regime for the conduct of investment business, the Conduct of Business Sourcebook (COBS), came info force on 1st November. COBS moves away from reliance on detailed prescriptive rules and will be about half the length of the old rulebook.

BaFin newsletter 10-07

The BaFin issued its latest newsletter. Central topic of this issue concentrates on the new minimum requirements for risk management (MaRisk) and the outsourcing possibilities for banks.

IPE: Small funds may be unaffordable in future – DNB

The average pension fund may well be too small to be affordable, says Klaas Knot, director of supervisory policy at the Dutch central bank DNB. He also warns that employers with smaller funds may need to be more transparent about the added value of the fund’s relative smaller size.

Equiduct standardises on Tibco's Rendezvous

Equiduct, the MiFID-ready pan-European platform, has standardised its electronic trading infrastructure on Tibco's messaging technology, Rendezvous. California-based Tibco says its messaging platform forms the foundation of the European trading system and is being used to deliver market data and trade information in real-time between various components of Equiduct's trading infrastructure.

OCC Approves Basel II Capital Rule

The Office of the Comptroller of the Currency (OCC) approved a final rule implementing the advanced approaches of the Basel II Capital Accord. This rule establishes regulatory and supervisory expectations for credit risk, through the Internal Ratings Based Approach (IRB), and operational risk, through the Advanced Measurement Approach (AMA).

CEIOPS paper on Supervisory Reporting and Public Disclosure

CEIOPS published an issues paper for consultation on the harmonisation of contents and formats for public disclosure and supervisory reporting. CEIOPS’ views that an adequate high level of harmonisation of contents and formats for supervisory reporting and public disclosure should be the goal to aim for. Deadline for comments is 1 February 2008.

CEBS summary of discussions on prudential filters

CEBS published a summary of the discussions on the hearing on the implementation and the impact of prudential filter. Participants were in general rather supportive of the conclusions CEBS has drawn. The question was raised whether the quantitative part of the study had also considered the effect of interest movements on the impact of the prudential filters.

U.S. Bank Regulator Approves New Capital Rule

A federal banking agency approved a rule that would give large U.S. banks more flexibility in managing their credit risk and calculating their capital reserves. The rule, approved by the Treasury Department's Office of the Comptroller of the Currency, implements international standards that are included in the so-called Basel II framework.

Corporates facing Sepa account conversion nightmare

The conversion of millions of direct debit mandates to comply with SEPA regulations is emerging as the biggest stumbling block to the implementation of the pan-European scheme. This is due to the requirement for all domestic account details to be converted to the BIC and Iban formats to comply with the SEPA 2010 deadline, warns Experian subsidiary Eiger Systems.

CEIOPS members’ meeting - main conclusions

CEIOPS held its Members’ Meeting in Frankfurt on 29 and 30 October 2007. The meeting addressed a number of important organisational and work issues including the results of the third Quantitative Impact Study (QIS 3) of the Solvency II project.  The results will be published on 20 November 2007. 

Mobile payments to soar - research

The popularity of mobile payments is set to rocket over the next few years according to a report from Juniper Research.The firm predicts that the total transaction value for all mobile payments - including remote systems like SMS and WAP as well as contactless - will be $22 billion in 2011 compared to just $2 billion in 2007.

CESR list of identifiers for transaction reporting under MIFID

CESR publishes a database listing identification codes for Regulated Markets, Multilateral Trading Facilities (MTFs) or other Central Counterparties. The European Commission will shortly be publishing  the official list of Regulated Markets within the EEA.

AMF Financial Regulation Newsletter - 4th quarter 2007

The AMF issued its fourth Financial Regulation Newsletter. AMF Managing Director Hubert Reynier states that the events following the subprime market crises represent a test of the way in which regulation is organised. “We are almost certainly experiencing the first full-scale test of disintermediation and of the new methods used by the market to manage credit risk”, he said.