Brussels, 02/03/2010 (Agence Europe) - “We are looking with interest at President Obama's proposals. We share his aim of reducing systemic risk in the financial sector. However, I do not think that a cap on size and scope is the right solution in the European context”, commented EU Internal Market Commissioner Michel Barnier on Monday 1 March 2010 at a dinner in London organised by the British Banking Federation. He said he favoured “a more comprehensive” approach to too-big-to-fail banks. At the February 2010 ECOFIN Council, he said that dangers to financial stability were also generated by the intermeshing of bank business (see EUROPE 10079). President Obama has suggested upper limits on the size of too-big-to-fail banks and banning high street banks from financing speculation and security trading for own account.
Michel Barnier called on Monday evening for appropriate supervision and own resources for financial institutions and for the EU to set an example here to the rest of the G20. “To restore confidence, we need regulation. And much better supervision. But smart, effective and proportionate legislation.” He said “finding the right calibration and sequencing will be essential to make sure that the cumulative effect of these reforms does not constrain the credit markets and the recovery. This is why we are dedicating the first half of 2010 to assessing the impact of these proposals, at global and EU level, before making any proposals.” The Commission is organising a consultation exercise until the third week of April on major aspects of the new EU legislation on capital requirements for banks and other lending institutions (see EUROPE 10088). (M.B./transl.fl)