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03 December 2009

This week in "Brussels" - with Podcast

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© 2009Jump directly to articles on:-
Financial Services Policy Banking Insurance Asset Management
Corporate Governance Competition: Financial Services Financial Services Month in Brussels - Report Edited Minutes of key legislative Bodies
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Articles from 26 November 2009 - 03 December 2009
Financial Services Policy Back to top 

2 December ECOFIN Council agrees new financial supervisory structure – 3 new watchdogs for European financial markets
The deal paves the way for 3 new watchdogs to supervise the financial system in all EU countries. They won’t be able to decide on future bailouts resulting from a future crisis. The City will mainly be controlled by the FSA.  View Article

ECON Committee 1 December – exchange of views with CESR Secretary General Eddy Wymeersch
Reforming CESR into ESMA is the main task facing CESR today. On accounting standards, the EU is not doing very well because US and EU standards are diverging and this is creating a huge gap. CESR defends international cooperation.  View Article

MEPs debate pros and cons of financial transaction tax – European Commission, however, isn't planning any measures at present
Noting the divergence of views at the hearing, Wolf Klinz (ALDE, DE) said that 'at the end of the day we'll have to take a political decision'. McCarthy (S&D,UK) pointed out that the public would like to know who will pay in the next crisis making a 'Financial Transaction Tax' necessary.  View Article

British Bankers believe Sarkozy has undermined EU with comments on new Internal Market commissioner
Mr Sarkozy said the British were the ‘losers’ in the battle for the top economic jobs in Brussels. He expects Mr Barnier to introduce regulations to curb the ‘Anglo-Saxon’ model of capitalism, creating a wave of complaints in the City.  View Article

European Shadow Financial Regulatory Committee 'trilemma' paper: A New Life for European Financial Supervision
The paper presents a ‘trilemma’ with three actors: financial integration, financial stability and national supervision. Combine freedom of capital movements and exchange rate stability while retaining national monetary policies - or not?   View Article

MEPs hear experts at joint ECON-CRIS seminar on monetary exit strategies and systemic risk
EU co-ordination of exit strategies, links between ECB and European Systemic Risk Board and a possible ban on products that destabilize markets were key issues raised by MEPs at a recent hearing of experts.  View Article

OECD paper on prudential regulation and competition in financial markets – no trade-off between stability and competition
It examines how stability-oriented regulatory policies for banking and insurance are linked to selected stability and competition outcomes. The results show there isn’t a general trade-off between policies and competition in banking and insurance.  View Article

FSA Turner’s speech: Responding to the financial crisis. Challenging past assumptions on capital levels
Lord Turner said that on capital requirements there is strong consensus that the global banking system should run with more capital and lower leverage in the future than in the past. The key question is how much more capital banks will have to keep.   View Article

Implementation of the Treaty of Lisbon – EU leaders welcome the end of the process begun in 2001
After the polemic Irish and Czech ratification, the treaty today entered into force. It will increase democratic accountability by enhancing European Parliament's decision-making power and creating a single voice representing Europe in its external relations.  View Article

Barroso's Commission appointments: skilful, disturbing result of automatically removing David Wright from financial services
The appointment of UK national Jonathan Faull as DG Internal Market alongside French Commissioner Barnier – under long-standing Commission staff rules – automatically requires the replacement of Deputy DG David Wright, despite his wealth of background and standing among stakeholders.  View Article

Trichet at DNB’s 2009 Financial Forum: shaping the future of global financial market regulation
When asked what impact the G20 has had on the work of the Basel Committee, Trichet said the G20 leadership, in determining the new financial regulatory framework, has led to a strengthening of the Basel Committee. This is a G20 success which will help to achieve financial stability.  View Article

Barroso final portfolio allocations for new Commission – French commissioner for financial services
The new College will have 27 members including 9 women. The members of the College come from different political families, notably the European People's Party (EPP). 14 members, including the President, are already members of the outgoing College.  View Article


Banking Back to top 

ECOFIN Council conclusions on SEPA - encouraging banks and payment institutions to implement SEPA Direct Debit
Council calling on industry to finalise outstanding technical standards required in cards market by mid-2010. They also emphasised that full benefits of SEPA can only be obtained through full migration of existing national Euro payment transactions.  View Article

ECB Gertrude Tumpel-Gugerell: how does thinking small first apply to financing conditions and payments of small to medium-sized enterprises?
SEPA benefits for SMEs, regardless of whether local or cross-border business: legal certainty; enhanced liquidity owing to faster payments and no lost value dates; competitive services;standardised payment terminals and banking software.  View Article

FT: 30 financial groups worldwide considered systemically risky - find out which institutions may be too big to control
The list has been drawn up by regulators under the control of the Financial Stability Board, in an effort to pre-empt systemic risks from spreading around the world in any future financial crisis. The list includes six insurance companies which sit alongside 24 banks.  View Article


Insurance Back to top 

CEIOPS consults on draft advice for Level 2 implementing measures on Solvency II
Consultation focuses on technical criteria for assessing third-country equivalence in relation to reinsurance and group supervision. To be considered equivalent, a third-country regime must meet each of the specified principles and objectives.   View Article


Asset Management Back to top 

ECON Committee 1 December – discussion on the AIFM - MEPs still divided over hedge-fund regulation
Jean-Paul Gauzès' report proposes a series of amendments ranging from scope of the directive to new provisions on depositories' liability, leverage limits, valuators, remuneration policy and AIF from non-EU countries. Not all MEPs agree with him and more amendments will be introduced.   View Article

Financial Future Forum – AIFMD has to be debated carefully as the devil is in the detail
Speaker and Liberal MEP Wolf Klinz believes leverage has to be addressed in the AIFMD. In order to control risk, there's a need to know how much money the fund has borrowed and on what conditions. Asset stripping should be banned.  View Article

AIMA expresses concern over proposed threshold for U.S. Systemic Resolution Fund - disproportionately high costs for hedge fund managers
Proposed Financial Stability Improvement Act would subject hedge fund industry to more onerous requirements than other financial institutions. Europe is having a similar debate with AIFMD, ready to impose higher capital requirements on AIF managers.  View Article

BVCA opinion on AIFMD report – more work is needed to achieve a useful directive
BVCA: Gauzes disclosure requirement worsens defective directive. Imposing regime designed for public companies on struggling venture capitalists and small companies battling to restore profitability is ‘risible’.  View Article

AIMA expresses concern over proposed threshold for U.S. Systemic Resolution Fund - disproportionately high costs for hedge fund managers
Proposed Financial Stability Improvement Act would subject hedge fund industry to more onerous requirements than other financial institutions. Europe is having a similar debate with AIFMD, ready to impose higher capital requirements on AIF managers.  View Article

Revised EU directive threatens to topple London as leading financial centre – hedge fund advisory firm says
This directive ‘will be detrimental to pensioners, shareholders and individual beneficiaries. Moreover, a ‘one size fits all’ approach is unhelpful and unworkable’, said Joe Seet, senior partner at Sigma Partnership.  View Article

Revised Swedish Presidency compromise text on AIFMD
The new revised compromise text is even more industry-friendly than the one published two weeks ago, showing how the industry is obtaining what it’s lobbying for. This week MEPs will debate Jean-Paul Gauze’s opinion report on AIFM.  View Article

EFRAG and European national standard-setters publish Financial Reporting of Pensions - feedback and redeliberations
The financial crisis has refocused attention on the need for financial reporting. The draft paper stimulates discussion on the principles that might be reflected in future accounting standards on employment-related pension benefits.   View Article


Corporate Governance Back to top 

FRC launches proposed reforms to the UK Corporate Governance Code – updating the role of the Board
The consultation includes enhancing accountability to shareholders by proposing either the annual re-election of the chairman or of the whole board. It also proposes ensuring the board is well balanced and challenging.  View Article

ASB’s report on Improvements to Financial Reporting Standards 2009 – convergence between UK and international financial reporting standards
The ASB has amended FRS 11 ‘Impairment of Fixed Assets and Goodwill’ to strengthen its disclosure requirements. Amendments are similar to those made by the IASB to IAS 36 ‘Impairment of Assets’ as part of its ‘Improvements to IFRS’ issued in 2008.  View Article


Competition: Financial Services Back to top 

Commissioner Kroes - five years of sector and anti-trust inquiries at Brussels ‘Competition 09 Summit’ – retail banking sector
The retail banking sector inquiry began in 2005. Since then DG COMP has paid attention because of: the highly fragmented market; concentrations harming consumers in certain areas; and self-regulation generally not fulfilling its potential.  View Article


Financial Services Month in Brussels - Report Back to top 

November 2009 - with Podcast
A podcast of this Overview is available here OVERVIEWThe European Council effectively ordered their Finance Ministers in ECOFIN to reach a  View Article




© Graham Bishop

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