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.
The most interesting outcomes of PSD2 will be derived from companies combining open banking with data from other areas like social media or government, argued Miles Cheetham, Open Banking Ltd.
The architecture of financial markets has changed and we will soon see the end of the last eight years of prosperity, said Stefan Bielmeier, chief economist and head of research at DZ Bank.
The US money market fund reforms came into effect in 2016 and are already dramatically shaping US fund industry with investors flooding out of prime funds and into government securities. While the reforms are similar, they are not the same. GTNews interviews Yeng Bulter, global head of the cash business at State Street Global Advisors on the differences.
There are various ways for financial institutions to benefit from advanced technologies and business models provided by FinTech's. Whether a business' approach is radical or incremental, data management can help a company to increase their return on investment, argues André Casterman, INTIX.