BIS Triennial Central Bank survey of foreign exchange and derivatives market activity

The BIS published its 2007 Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity Report. The survey shows a substantial increase in turnover in foreign exchange and OTC derivatives markets.

JURI meeting 19 December

The EP JURI Committee discussed the report of Mr Lehne on a simplified business environment for companies in the areas of company law, accounting and auditing, and the report of Sharon Bowles on Solvency II.

FT: Investors stunned by ECB’s €350bn

Short-term market interest rates in the eurozone plunged at their fastest rate for more than a decade on Tuesday after the European Central Bank stunned investors by pumping a record €348.6bn worth of funds into the markets. The size of the injection was twice as big as the ECB had indicated would have been needed in normal circumstances.

Commission prohibits MasterCard's intra-EEA Multilateral Interchange Fees

The Commission has decided that MasterCard's multilateral interchange fees for cross-border payment card transactions with MasterCard and Maestro branded debit and consumer credit cards in the European Economic Area violate EC Treaty rules on restrictive business practices. MasterCard has six months to comply with the Commission's order to withdraw the fees.

MLex: EC rules MIF fees 'not illegal' as such

The European Commission has ordered MasterCard to withdraw its 'interchange fees'. Crucially, the commission has stated that the fees are “not illegal as such” however they are only compatible with EU competition laws if they contribute to “technical and economic progress and benefit consumers”. 

CESR consultation on equivalence of Chinese, Japanese and US GAAP

CESR published a consultation paper on it’s advice on the equivalence of Chinese, Japanese and US GAAP to assist the Commission in determining the equivalence of third country GAAP under the Prospectus and Transparency Directives. 

Speech McCreevy: Current challenges facing the global banking sector

Commissioner McCreevy reiterated that a 'knee-jerk' reaction to recent events should be avoided. However, “it is legitimate to ask how well financial institutions understood the complexity of some of the financial instruments they deployed and invested in”, the Commissioner said. “If the industry, amongst others, cannot do better in the future - strong pressure for intrusive regulatory action will grow”.

ECON meeting 18-19 December

The EP ECON Committee held a public hearing and a first round of discussion on Solvency II and discussed among others International Financial Reporting Standards and the governance of the IASB Rapporteur.

EFBS: McCreevy pulls the emergency brake

The EFBS supports the Commission’s view that a necessity for regulating has not been proven so far. With regard to the further impact assessments, EFBS hopes that “the Commission manages to commission consultants who have a better economic understanding than the consultants of London Economics”.

FASB consultation on proposed financial accounting foundation changes to FAF, FASB, and GASB

The FAF Board of Trustees released for comment a series of recommendations focusing on the FAF’s oversight role, operations and governance, the FASB’s structure and operations, and the GASB’s funding and operations. 

Commission White Paper on Mortgage Credit

The Commission published its White Paper on the Integration of EU Mortgage Markets. The White Paper includes a 'package' of measures, but does not propose a directive. The package foresees improvements in the areas of cross-border supply, product diversity, consumer empowerment and customer mobility.

China gives the green light for banks to invest in British funds

China loosened its controls on overseas investments by opening the door to its banks to invest in British stocks and mutual funds. Britain becomes only the second destination after Hong Kong in which the banks can invest their clients’ money.

HMT extends wholesale guarantee arrangements to Northern Rock

The UK Treasury confirmed that the guarantee arrangements for Northern Rock are being extended to include unsubordinated wholesale obligations.

Article: FRC warns over corporate reporting risks

The Financial Reporting Council warned that turbulent credit market conditions mean corporate reporting and governance risks are higher than they have been for “some years”. The regulator said there were “dramatic” liquidity challenges for financial institutions.

FT: ECB steps up fight to safeguard liquidity

Emergency help for financial markets entered new territory on Monday as the European Central Bank announced it would on Tuesday offer unlimited funds at below market interest rates in a special operation to head off a year-end liquidity crisis. The surprise move suggests the ECB is still frustrated at the failure to ease financial market tensions.

Japanese predators come full circle

Nomura's interest, albeit very tentative, in Collins Stewart comes on the heels of Orix, the Japanese conglomerate, investigating a bid for Close Brothers, another mid-market UK investment bank. As well as providing echoes of the 1980s, the moves show foreign banks are ready to use the market downturn to seek City bargains, as London gains on New York as a global financial hub.

Nyse Euronext developing bond trading platform

Nyse Euronext is working on the development of a bond trading platform that can handle fixed-interest securities from both the US and Europe, according to a report by French newspaper L'Agefi. The report says that the transatlantic exchange plans to launch the platform by the end of the first quarter of 2008.

ECB consultation on TARGET2-Securities

The ECB published for public consultation the T2S user requirements and the methodology for the assessment of the economic impact of T2S. The final user requirements will be presented to the ECB decision-making bodies for decision in summer 2008 as to whether to start the build phase. 

Euroclear set to implement ‘record-breaking’ fee reductions

Euroclear UK & Ireland plans to implement record-breaking fee reductions of £11.8m in 2008. The settlement and clearing house said its clients were expected to benefit from overall savings of around 10pc on average.

Commission adopts Communication on Financial Education

The Commission adopted a communication on better financial education setting out some basic principles to guide providers of financial education and announced some practical initiatives. The principles include, amongst others, a recommendation to tailor programmes to the real needs of the target audience.

CESR key information of enforcement decisions of financial information

CESR published extracts from its database of enforcement decisions taken by EU National Enforcers participating in European Enforcers Co-Ordination Sessions (EECS).

Consultation paper on improving the functioning of MiFID database

CESR issued a consultation paper on improving the functioning of MiFID database. CESR will eventually undertake an update of the databases, and publish new versions in March 2008.

AMF recommendations regarding financial statements for 2007

Telegraph: Call to relax Basel banking rules

The Government must suspend a set of key banking regulations at the heart of the current financial crisis or risk seeing the economy spiral towards a future that could "make 1929 look like a walk in the park", one of Britain's leading economists, Peter Spencer, has warned. Conflicts caused by the Basel system of banking regulations are the root cause of the crunch and were serving to worsen the City's plight.

IAIS global re-insurance market report

The IAIS published its fourth annual global re-insurance market report which provides an overview of the financial condition of re-insurers. The report considers future challenges to the market, concluding that the sector remains robust and that low levels of losses during 2006 have improved the industry’s financial condition.

FT: US looks to London for regulatory model

David Nason, the Treasury's assistant secretary for financial institutions, had a serious message. The US is contemplating the biggest overhaul of its system of financial regulation since the passage of the 1999 Gramm-Leach-Biley Act, which allowed banks to consolidate commercial and investment banking under one roof.

European Council

Commission published European Financial Integration Report 2007

The Commission has published its European Financial Integration Report (EFIR), an annual analysis of integration of the EU financial services sector.  The report finds, amongst others, that financial integration has progressed although the speed and scope has not been the same across all market segments.

Commission impact assessment on transfer of registered office

The Commission published an impact assessment on the Directive on the cross-border transfer of registered office. Commissioner McCreevy has decided there is no need for action at EU level on this issue.

Commission impact assessment on shareholder's rights

The Commission published an impact assessment on the question of proportionality between capital and control in listed companies, commonly referred as to the "one share, one vote" problem. Commissioner McCreevy has decided there is no need for action at EU level on this issue.

ECB Financial Stability Review

The ECB publishes its December 2007 Financial Stability Review which finds that the uncertainty surrounding the financial stability outlook for the euro area has heightened. The adjustment process in the financial sector over the coming months is likely to prove challenging, the ECB notes.

FSA Japan report of Financial Markets Strategy Team

The Financial Services Agency of Japan issued its first report on the exposures of Japanese deposit-taking institutions to subprime-related products. In this report, the team analyses the background of the subprime mortgage problem, its developments and associated policy issues.