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11 December 2008

This week in "Brussels"

Articles from 04 December 2008 - 11 December 2008

Trichet – Implementation is key challenge to supervisory colleges
A cumbersome decision-making process in case of disagreements cannot be afforded, Trichet said with regard to the CRD review. The effectiveness of the colleges depends on their ability to facilitate decision-making for the banking group as a whole.  View Article

AMF Economic and Financial Newsletter – Autumn 2008
The intensification of the financial crisis, the significant increase in uncertainty and the general loss of confidence are creating an environment that favours an even sharper deterioration in economic activity in the USA, Europe and Japan.   View Article

Trichet - supervision of cross-border financial institutions needs to be enhanced
The risk management systems have to be improved, the ECB President said. The compulsory establishment of colleges of supervisors for all cross-border banks are particularly important, he said.   View Article

McCreevy outlines urgently needed measures to overcome crises
Light touch regulation and self regulation did not work, the Commissioner said. Half of the advocates of such a regime have been sacked and the other half have seen their instruments broken.  View Article

IMF F&D magazine on Financial Crisis
The magazine concentrates on priorities for regulatory reform in the aftermath of the financial crises. Articles concentrate on ways to assess systemic risk and crisis prevention.  View Article

PCAOB Olson outlines future issues for analysis
The PCAOB will take a hard look at off-balance sheet entities, underwriting standards, gaps in regulatory coverage, and flawed risk management, Olson said. This process undoubtedly will lead to regulatory and legislative improvements.  View Article

Fed Kroszner – Financial products need to become simpler
Products traded in financial markets have to become simpler, standardized and more transparent, Krozner said and also called for higher liquidity and capital buffers held by banks.  View Article

PCAOB issues staff audit practice alert on audit considerations in the current environment
The alert outlines potential areas of heightened audit risk which include issues such as fair value measurement, the adequacy of disclosures, and accounting estimates.   View Article

EFBS calls Commission 'non-banks’ study a ‚complete waste of money’
“Non-banks” played a disreputable role in the current development of the subprime-market, Managing Director Zehnder said. Deliberations on a European Passport for these kinds of companies are absolutely not comprehensible.  View Article

BIS Quarterly Review - December 2008
The Review surveys the recent developments in the financial crisis and the unprecedented policy actions launched to address it.  View Article

CESAME stock taking report on Giovannini Barriers
The report provides an overview of the work done on the six Giovannini Barriers to post-trading and of the state of play on nine Barriers attributed to the public sector.   View Article

Asset management industry guidelines address over-reliance on credit ratings
The Guidelines have been produced as a response to the call of the FSF on investors to address their over-reliance on ratings and to review their standards of due diligence and credit analysis when investing in structured credit products.   View Article

CESR list on short-selling measures - update
The statement paper includes either the statements or links to the statements published by CESR Members explaining the measures taken.  View Article

Xtrakter launches new mark to market valuation service
Xtrakter launched its new XM2M mark to market valuation service which allows inter-dealer brokers and market makers to ensure their securities are correctly valued.   View Article

CEIOPS interim report on supervisory powers
The report represents the second part of work on EU supervisory powers and finds, among others, that there is only a low level of harmonisation with regard to ‘rule making’ powers.  View Article

McCreevy not to regulate private equity
Private equity does not give rise to macro-prudential or systemic concerns and should not be lumped together with other categories of leveraged financial institutions, McCreevy said.  View Article

McCreevy outlines future measures for accounting
In the longer term, the creation of a single high-quality global accounting standard, potential pro-cyclical effects of fair value accounting and the treatment of off-balance-sheet exposures are essential.  View Article

IASB revised proposal to eliminate unnecessary disclosures for state-controlled entities
The revised exemption would not require state-controlled entities to assess the extent of state influence and would exempt such entities from providing full details about transactions with other state-controlled entities and the state.   View Article

EFRAG issues AASB discussion paper on intangible assets
Many intangible assets are recognised under existing accounting standards only when they are acquired from others. The paper intends to encourage an international debate to improve the IASB’s standards on intangible assets.  View Article

EFRAG consults on IAS 39 & IFRS 7
EFRAG is consulting both on the updated amendment against the EU endorsement criteria and on the costs and benefits that would arise from the implementation of the updated amendment in the EU.   View Article

IASB consults on constitutional issues
Issues on the IASC consultation include the possible need for emergency due process procedures, funding arrangements and the IASB’s agenda-setting procedures.   View Article

EFRAG calls for enhanced role in standard-setting process
EFRAG concludes in its report to strengthen its role to provide “timely and effective proactive input in the early phase of the IASB process”.  View Article

CESR comments on EFRAG draft letter on IFRS 7
CESR thinks that additional disclosures should also be required for financial instruments that are not recognised at fair value, but which were reclassified during the reporting period that is presented.   View Article

ECON consideration on draft report on CRD
Mr Karas made clear that he will not reduce his report on the Council compromise. The directive must be coherent with other important directives, and the results of the G20 meeting need to be incorporated  View Article

ECON meeting 8 December
ECON Committee held a discussion with ECB President Trichet and adopted the report on deposit guarantee schemes.  View Article

ECON workshop on Credit Rating Agencies
The workshop concentrated on issues such as the conflict of interests, the quality of ratings, supervision and the registration of rating agencies in the EU. Mr Gauzes plans to issue his draft report on 20 January next year.  View Article

Commission approves Dutch recapitalisation of SNS REAAL
The Commission approved the emergency recapitalisation worth €750 million the Dutch authorities intend to grant to SNS REAAL.   View Article

Commission approves Austrian support scheme for financial institutions
 The Austrian package consists of guarantee measures with a total budget capped at €75 billion and state guarantees with a total budget of €15 billion.   View Article

Commission authorises French rescue scheme
The Commission approved the French capital-injection scheme for banks which are under severe pressure to increase their capital owing to the financial crisis.   View Article

Commission guidance on bank recapitalisation
Commissioner Kroes announced to adopt the French and the Austrian scheme. However, with regard to Germany, the Commissioner requests adjustments ‘which should accommodate an agreed solution as regards Commerzbank’.  View Article

MLex Comment: EC's regulatory intent undented by credit crunch critics
Commission anti-trust regulators are coming under unprecedented criticism for their handling of the financial crisis and the present and future role, if any, of competition policy in regulating European financial markets.  View Article

Kroes – Commission not powerless
Commissioner Neelie Kroes stressed that the Commission is ‘not powerless’ in dealing with the state aid issues arising out of the current financial crisis. There is ‘no rubber stamping exercise’ for state aid rules, she warned.   View Article

© Graham Bishop

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