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The EFBS released a statement on the current anouncement of President Bush on the subprime crisis and its effect for the EU mortgage market integration. President Bush announced on 31 August 2007 a package of measures in order to stabilise the subprime market and protect consumers. Regrettably, the President did not announce, to implement Basel II nationwide. If Basel II would have been implemented, credit risks would have further diminished due to common standards and probably the subprime crisis could have been prevented.
In the context of the current reflection of the European Commission how to regulate the EU mortgage market, it is interesting to note, that President Bush now seems to try to copy existing EU consumer protection standards, EFBS notes.
“This is a clear sign for the European Commission, that it is important to keep these information standards for home and mortgage loans as they are in order to ensure that consumers are well informed when they compare mortgage credit offers,” Andreas Zehnder, Managing Director of the EFBS said. “Moreover on both side of the Atlantic, the role of the accountant firms and rating agencies, which certainly share a common responsibility for the false interpretation of the subprime risk, should be further investigated.”
In a former statement the EFBS called the Commission to draw early enough conclusions from the dramatic development on the US mortgage market and to prevent European consumers in any case from risky and reckless housing finance systems.
“The Commission’s considerations how to regulate the EU mortgage market should first and foremost reflect the needs of the consumers”, Zehnder.
Press release 1 September
Press release 28 August