On Supervision and Crisis Management
July 7, 2010 11:00 AM
By Sharon Bowles MEP in European Parliament Plenary session
Originally published by Sharon Bowles MEP
By Sharon Bowles MEP in European Parliament Plenary session
Originally published by Sharon Bowles MEP
Despite good things in Solvency 2 which have already been mentioned, we shelved the group support regime due to concerns over its practicality in periods of economic stress, its interplay with national insolvency laws and mistrust of other countries' supervisors.
Crisis examples such as Fortis Bank exposed grounds for such suspicion - and the need for a European supervisory architecture and discipline.
Solvency 2 convinced me that cross-birder insolvency, and near insolvency, in financial institutions has to be tackled at European level. This is challenging, but it seems a serious omission from the whole concept of the single market.
The Ferreira report covers many of these issues and I thank her for including my ideas on averting moral hazard from crisis funds and a 28th Regime for insolvency of cross border banks.
Planning is everything and contingency plans, living wills and resolution mechanisms will reveal a lot about the present as well as protecting the future.
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