Three of the leading figures at the European Central Bank (ECB) each warned on Saturday that ideas for a levy on bank profits, pushed as a way to create a buffer against future crises, need much more work.
“We insist very much on the fact that we need proper sequences and a proper respect of the Basel committee,” ECB chief Jean-Claude Trichet told reporters after a meeting of EU finance ministers in Spain, referring to the international banking industry’s in-house panel of regulators.
Trichet said that a redrawn banking and financial system had to be “resilient,” underlining that it must not “hamper the recovery” underway and therefore that possible taxation had to be examined in the light of other reforms.
Both Sweden and the European Commission have come up with plans that were discussed informally by the EU ministers.
Portugal’s Vitor Constancio, who takes office next month after being elected as Trichet’s deputy last month by leaders of the 16 euro countries, also told reporters that proposals to tax banks, which emerged amid anger over huge taxpayer bailouts, could not be set up in isolation.
Constancio said levy ideas could only be properly assessed after tests on separate proposals to regulate banks’ capital liquidity, “because we need to assess the overall impact of everything that is now being studied regarding future regulation of the banking sector.”
“It’s a little bit premature,” he said.
“I also think that if governments want to go ahead, that this be linked with deposit guarantee schemes and possibly used only for restructuring and resolution problems of the banking sector itself, not for any other purposes,” he said.
Mario Draghi, who represents the Bank of Italy at the ECB, likewise insisted that the levy’s broader economic impact — with wide variations in suggested levels — had to be examined fully first.
He said banks were already losing “more and more” through writedowns on credit losses.
European commissioner for economic and monetary affairs Olli Rehn said after the talks that politicians should not over-regulate.
Spanish Finance Minister Elena Salgado, hosting the meeting, added that authorities had to “avoid imposing on the financial sector excessive charges that could weigh on the economic recovery.”
Europe’s financial services overlord, France’s Michel Barnier, said on Friday that deals on banking regulation were needed quickly if anything stronger than “artificial” controls are to be put in place.
“I hear ministers and bankers telling me: Go easy, if you ask for capital requirements that are too great, we won’t have any money left with which to finance the economy.”
“I remind them of the costs of the crisis,” Barnier said, adding it was “unacceptable for taxpayers, because we hadn’t drawn up new mechanisms, to be forced to pay for the mistakes and over-the-top actions of certain actors within the financial system.”
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
China's military today said it began joint army, navy and rocket force exercises around Taiwan to "serve as a stern warning and powerful deterrent against Taiwanese independence," calling President William Lai (賴清德) a "parasite." The exercises come after Lai called Beijing a "foreign hostile force" last month. More than 10 Chinese military ships approached close to Taiwan's 24 nautical mile (44.4km) contiguous zone this morning and Taiwan sent its own warships to respond, two senior Taiwanese officials said. Taiwan has not yet detected any live fire by the Chinese military so far, one of the officials said. The drills took place after US Secretary
THUGGISH BEHAVIOR: Encouraging people to report independence supporters is another intimidation tactic that threatens cross-strait peace, the state department said China setting up an online system for reporting “Taiwanese independence” advocates is an “irresponsible and reprehensible” act, a US government spokesperson said on Friday. “China’s call for private individuals to report on alleged ‘persecution or suppression’ by supposed ‘Taiwan independence henchmen and accomplices’ is irresponsible and reprehensible,” an unnamed US Department of State spokesperson told the Central News Agency in an e-mail. The move is part of Beijing’s “intimidation campaign” against Taiwan and its supporters, and is “threatening free speech around the world, destabilizing the Indo-Pacific region, and deliberately eroding the cross-strait status quo,” the spokesperson said. The Chinese Communist Party’s “threats
RSS