US and EU should set an example on financial market regulation reform

26 October 2009 – “America and Europe should set a good example when it comes to reforming financial market regulation,” said Manfred Weber, Chief Executive of the Association of German Banks, on the occasion of today’s meeting between the European Commission and the US government in the Transatlantic Economic Council. “It is especially important for the rules governing the major financial markets to be coordinated with one another.”

Although the G20 governments were trying to improve coordination, there were significant differences between legislative proposals in the US and the EU, he added. “Coordination does not necessarily mean identical rules. But comparable standards in one jurisdiction should always be recognised in the other.”

Weber warned against the US or the EU taking action prematurely and unilaterally, thus making it more difficult to find a joint way forward. “US draft legislation on capital requirements should therefore not pre-empt discussions by international supervisory bodies.” He pointed out that the new US rules would also affect German banks operating in America as financial holding companies. Furthermore, there was a need for, if not uniformity, at least greater convergence in accounting standards for financial instruments. Weber also called on the EU to ensure consistency when legislating on financial markets. This applied with regard to hedge funds, for instance, he said.

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