Financial sector welcomes UK oversight of Banking Union

city

After fighting against Juncker’s nomination, the United Kingdom ensured Lord Jonathan Hill would have a prominent role in guiding the direction of the banking union. This will involve oversight of new mechanisms designed during the crisis as well as the appointment of a new Directorate General for Financial Stability.

The changes may make some waves on a day-to-day basis in Brussels, with France, a Eurozone-core country, previously holding these responsibilities. Juncker has now taken the bold move of splitting the Department in two, assigning the main role to the UK in the process. The move comes as the new president of the Commission aims to develop capital markets by boosting the European economy with €200 billion worth of growth.

 “Regulators, stakeholders and all members in the financial sector see the new structure as a crucial step”, explained a source to The Corner.

The political implications are significant, because a non-euro currency country ruling the banking system could well foment mistrust amongst members, with sources in the financial sector acutely aware of possible bumps ahead, according to the expert, who participated last weekend in the Eurofi Forum in Milan.

The meeting in Milan, in tandem with Eurogroup and Ecofin, brought together public decision-makers and the financial industry to discuss the on-going reforms. The sector insists on the necessity to integrate capital markets and, moreover, wants new rules to protect investors.

“There is too much work to do to create a European capital market. EU countries have different opinions about it so the message launched by Juncker with this new Department is very important” believes Josina Kamerling, Head of Regulatory Outreach from CFA Institute.

The City of London, the main stock-market in Europe, which had been so opposed to Juncker´s appointment, may actually reap some benefits from some of his early decisions. However Lord –Hill should tread carefully in his new role, with the need to appear even-handed crucial in the new setup.

 

Be the first to comment on "Financial sector welcomes UK oversight of Banking Union"

Leave a comment