The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.
Banking

Regulation: The death of global standards

Just as concerns grow that central bank monetary policy is under threat of becoming politicized, there are also fears that politics is corroding the objectivity of rule makers, putting the stability of the financial system at risk.



regulation-death-global-standards-600 

UK chancellor of the exchequer Philip Hammond, a member of the EU Parliamentary committee responsible for financial regulation (Econ), was not the only one who was taken aback at a committee meeting in early December.

The committee was discussing the updates to the Capital Requirements Regulation and Capital Requirements Directive IV proposed by the European Commission on November 23. This included a provision that would force larger third-country groups with two or more subsidiaries in the EU to create intermediate holding companies subject to internal capital requirements. Hammond was said not to have seen it before.

21b

This proposal – article 21b of the Banking Reform Package – is seen as even more onerous than US requirements. Law firm Allen & Overy says it will have a “profound” impact on costs and operational complexity for many non-EU headquartered firms. 

“The inclusion of intermediate holding companies [in the proposals] isn’t great,” says one senior official at an industry lobby. “If everyone did it, what would be the purpose of having a global resolution framework?” 

Early drafts of the proposals were leaked, but market stakeholders in the UK confirmed that none of those leaks included that provision. 



You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree