Letter to the Editor of The Daily Telegraph, sent on 22nd Decmber 2011
You reported on 20 December 2011 that “Brussels has demanded that key banking regulations are set centrally” but that Brussels itself “is proving an obstacle to reducing systemic risk”.
Let me put the record straight. “Brussels” has not demanded anything. All EU national leaders called in 2009 for “a European single rule book applicable to all financial institutions in the single market.” They realised that many banks had been poorly managed, regulated and supervised.
One important chapter of the single rule book concerns implementing international agreements known as Basel III, setting capital requirements for banks. How and when individual countries can raise those requirements is now being debated in the European Parliament and Council of Ministers. But contrary to many reports, the Commission’s proposal allows considerable flexibility for national supervisors on this.
We understand that London has the largest financial sector in the EU and we want UK supervisors to be able to do their job properly. This is a time for rational debate about the discretions needed at national level in a single market with a single rule book, not for simplistic stories setting “Brussels” against “London and “the City”.
Head of Cabinet of Michel Barnier
European Commissioner for Internal Market and Services