Juncker to demand direct supervision of clearing houses as GLOBAL banks & investors balk

Juncker to demand direct supervision of clearing houses as GLOBAL banks & investors balk

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Mr Juncker is demanding more interference Getty

Mr Juncker is demanding more interference

The unelected president will make his proposals tomorrow as banks and investors, as well as the London Stock Exchange (LSE), warn the moves will damage international competition.

Last week, Mr Juncker said the European Union was to publish proposals to implement “limitations” on central banks across the remaining 27 states as they continue their power grab. 

This week more details have crept into the public domain which appear to show Mr Juncker will invade all European passported Clearing Houses.


The net effect would be the creation of an international offshore euro swaps liquidity pool for non-EU entities

LSE


A draft document which is to be released tomorrow and followed up with a set of guidelines in June is set to show that all financial centres will have to be “subject to the EU legal framework” laid down by former Luxembourg prime minister Juncker, who is under-fire in his own country following the LuxLeaks scandal.

Mr Juncker is said to prefer the idea that “where necessary, direct supervision at EU level and or location requirements” is introduced for all banks working in the European Union, including British and US domiciled institutions.

The London Stock Exchange (LSE), which operates worldwide, is warning that the impact could lead to an “off-shore euro swap liquidity pool” while at the same time helping to dry up the internal swaps market, which will in turn make it smaller.

Euro swaps could sit off shore which would impact internal markets warns the LSE GETTY

Euro swaps could sit off shore which would impact internal markets warns the LSE

The LSE, which dramatically put the brakes on its merger with Germany’s Deutsche Börse Group amid an anti-trust probe in February, has slammed the proposals.

It says: “The net effect would be the creation of an international offshore euro swaps liquidity pool for non-EU entities, and a parallel less liquid, smaller onshore euro swap market which would damage only European issuers, savers, investors, pension funds and intermediaries”.

London-based MEP Syed Kamall said: “The question of future oversight from the EU will be a matter for the Brexit negotiations, but politicians should listen to the businesses that actually do the trading and ask where they want to be.” 

Mr Juncker was slated over the Lux Leaks scandal but apparently wants more power GETTY

Mr Juncker was slated over the Lux Leaks scandal but apparently wants more power

Last week French and German banks spoke out to prevent the blatant power grabs by Brussels over fears their policies will effectively stifle growth, lead to jobs cuts and ultimately kill profits.

The financiers say they will not allowed to be competitive internationally after the bloc announced it is to make sweeping alterations to capital markets. 

Frederic Oudea, chair of the European Banking Federation and chief executive of SocGen, said: “We cannot ignore the growing fragmentation of the international regulatory landscape in light of recent political changes notably in the US. 

“The perspective of the Brexit adds… to that trend.

“This topic is particularly important at a time where we need to think strategically about the direction we want to take for capital market activities in Europe in light of Brexit consequences.

“The Economic Affairs Committee has oversight of financial rule-making in the European Parliament, which has joint say with member states on approving the EU’s laws.” 

Juncker met Soros last week who threatened Britain could crash GETTY

Juncker met Soros last week who threatened Britain could crash

Andreas Treichl, chief executive of Austria’s Erste Group, said he was spending most of his time with politicians and 10 regulators, rather than with customers.

He said: “Please reflect on what you have done. 

“It’s very, very difficult for us to be helpful to create prosperity, and part of the reason is ourselves, and part of the reason is you, the politicians, and part of the reason is the regulators.

“Who do you think will finance start-ups? The capital market is not there, the private investors are not there, and banks increasingly face difficulties in doing it.”

Meanwhile Karl-Peter Schackmann-Fallis German Savings Banks Association board member said banks need “a regulatory pause”.

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