02 February 2009

ECON meeting 2 February

ECON Committee discussed the amendments made to the report on the Capital Requirements Directives, prepared by MEP Othmar Karas, and had an exchange of views with Commissioner McCreevy.

ECON Committee discussed the amendments made to the report on the Capital Requirements Directives, prepared by MEP Othmar Karas, and had an exchange of views with Commissioner McCreevy.

 

Commissioner McCreevy called for a regulatory approach for the clearing of Credit Default Swaps following the missing industry initiative. He also strongly opposed to any attempts to carve-out short term inter-bank exposures from any prudential rules of the CRD. “Member States don't want this. Supervisors have warned against it. And I urge you to be against it”, he told MEPs. He also warned against “any attempt to exclude vaguely described types of securisation from the requirements”. “The well paid City lawyers must not find a way round it”, he said.

 

Mr Karas (EPP/AUT) welcomed the large number of amendments as a sign of the importance of the issue. He saw the possibility of a first-reading agreement and considered that a step ahead in the shaping of the interior market was not negotiable. He went on to comment on the main issues: large exposures, securitisations and supervisory arrangements.

 

Furthermore, he mentioned that several minor points had to be resolved as well, noting that it was impossible for the report to include a whole wish-list drawn up by the G20 and the de Larosière group. But in any case, the Directive would become a transitional measure that would need to be replaced in its turn within two or three years.

 

Ms Beres (PES/FR) deplored the frustrating situation in which no problem was really solved and considered it was still necessary to adopt a proposal before the end of the mandate. She regretted that the Commission proposal on supervision had already lacked ambition, and that now the Council was showing even less. She wondered whether this could be accepted. She also suggested more favourable rules for micro-credits.

 

Ms van den Burg (PES/NL) expressed concerns that the Directive could be too static on securitisation; fine-tuning should be left to a Lamfalussy Process. Mr Hökmark (EPP/SE) suggested acting in a way not to interfere with interbank lending which was starting up again. Some amendments risked causing even more trouble.

 

A Commission representative commented on some amendments, noting that the proposal would not disturb interbank lending, it might only lead to increased cost for banks. He admitted the need to review supervision and structures, but did not consider the proposal to be the right instrument for this.

 

A second consideration is expected to take place on 11 February.

 

Karas draft report, Amendments 27-137, 138-239, 240-285

(Full speech McCreevy see here).

 

A full report is attached below.