The chairman of European Union (EU) finance ministers has said that an agreement on new global banking rules should be delayed until the new US administration under president Donal Trump has clarified its attitude towards financial regulation.
“It is not that we want to delay, but things are changing rapidly,” said Maltese finance minister Edward Scicluna announced, before the latest monthly meeting of EU finance ministers in Brussels to discuss the state of the Basel negotiations.
Scicluna acted as spokeperson as Malta holds the rotating presidency of the EU until July. He added that it would be wrong to take a decision when the outlook is unclear and the uncertainty was largely due to uncertainty over the Trump administration’s intentions on financial regulation. Global regulators should reach an agreement only “once the dust settles”, to avoid being caught up with a wrong deal.
Long-standing disagreements between the EU and US over how to reform rules on banks’ capital requirements and loss-absorbing buffers have halted progress by the Basel Committee on Banking Supervision (BCBS) of global financial regulators, which oversees US, European and Japanese banks.
The original deadline to reach a deal before the end of 2016 was missed and a meeting scheduled for four weeks ago was postponed. No revised target date has been proposed.
Reforms proposed by the Committee have been opposed by Europe and Japan, which claim that the review goes too far and increases disproportionately the capital banks must hold against risk. This would increase the costs for banks in both regions and hand an advantage to their US rivals.
ExxonMobil is legally challenging a $2m fine from the US Treasury for allegedly violating sanctions against Russia in 2014 while US Secretary of State Rex Tillerson was still overseeing the company.
Morgan Stanley is moving staff to Frankfurt in time for the March 2019 Brexit deadline.
The US bank, which already has 350 employees based in the city, will transfer some trading activities currently undertaken in London and create a further 150 to 250 jobs according to reports.
BNP Paribas is the latest in a long line of financial service companies to be penalised for misconduct during the financial crisis on both sides of the Atlantic.