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Ministers underlined the necessity to address the banks' impaired assets and the need to tackle international accounting standards in relation to the steps taken by the US. ECOFIN also discussed the reform of the structure used to supervise the financial market in the EU.
The informal ECOFIN meeting welcomed the results of the London G20 summit. The agreement to substantially increase the funds of international financial institutions, including, but not limited to, the IMF, and the progress made on the issue of financial markets regulation, which saw the approach of the EU pushed through to a considerable degree, was pointed out as a major success.
ECOFIN also discussed the reform of the structure used to supervise the financial market in the EU and agreed that financial market supervision will have to be reformed at EU level to strengthen confidence in the financial markets and prevent future crises.
ECOFIN, threrefore, supported the creation of an European Systemic Risk Council (ESRC) and reaffirmed the need to harmonise the European supervisory framework. Accordingly, the participants agreed on the need to approximate the powers of the supervisory bodies and strengthen their independence, while ensuring convergence of rules, standards and sanctioning powers between the Member States as suggested in the de Larosière report.
Member States also agreed on the general necessity to strengthen and transform the Lamfalussy Level 3 Committees into new bodies with a specific legal framework. The Economic and Financial Committee and the Financial Services Committee are called to further discuss the proposals and try to find a common compromise.
A further round of discussions on the reform of the supervision structure in the EU will be held at the June ECOFIN meeting, where they will prepare a paper on this subject for the June European Council.
Ministers also welcome, in particular, that the G20 has just agreed that the accounting standard setters should improve standards for the valuation of financial instruments, based on their liquidity and investors' holdings horizons, while reaffirming the framework of fair value accounting.
Ministers call on the IASB to cooperate closely with the FASB to immediately address the issue on fair value accounting.
Council Presidency press release day 1
Council Presidency press release day 2
ECOFIN statement on accounting standards
Commission press release