31 March 2009

ECON meeting 30-31 March

ECON held its regular monetary dialogue with ECB President Jean-Claude Trichet. “The Systemic Risk Council will identify and assess risks and vulnerabilities in the EU financial system, issue risk warnings and adopt related policy recommendations”, Trichet commented on the recently published de Larosiere report.

“The proposed composition of the Systemic Risk Council reflects a recognition of the role played by central banks in macro-prudential supervision”, he said and underlined that the Council should report its risk warnings and relevant recommendations to the ECOFIN Council.

However, Trichet also called for an “appropriate institutional basis” for this Council and the related new macro-prudential tasks of the ECB and ESCB. “The activation of Article 105(6) of the Treaty could be a very useful avenue in this context”, he reiterated.

Trichet underlined that the Systemic Risk Council will have to rely on a wide range of macro- and micro-prudential data which implies that the ECB and the ESCB should have access to the relevant micro-prudential information from supervisors.

Questioned by MEP Wolf Klinz about possible diffrerent approaches between the US and the EU on the regulation of financial markets products - where the EU aims at a comprehensive framework for all available products, while it seems the US would focus on those of "systemic relevance” - the ECB President replied he is confident in both powers having the same goals in mind. “I expect the unity of all participants (...) on actions and reforms” to be implemented, he said. “We need global diagnosis and global decisions”, he added.

Full speech Trichet

EP press release