French Finance Minister Michel Sapin is urging the EU to slow a plan to create a capital-markets union, which would reduce barriers to investment in the bloc. "We would not be better off if we failed because we rushed things," Sapin said.
The European Securities and Markets Authority has changed pre-trade transparency requirements for requests for quotes under the revised Markets in Financial Instruments Directive. Quotes will be published when all have been submitted, rather than disclosed as they come in. Market participants applaud the change.
US investment banks' advantages over European counterparts have some executives floating the idea of forming larger, globally competitive institutions. "In the long run, properly capitalised European investment banks would be a worthier source of pride than unsustainably competitive ones," George Hay and Dominic Elliott write.
Barclays Chairman John McFarlane is calling for a merger of European investment banks to make them more competitive with US banks. McFarlane acknowledges creating a megabank "would need political support", which is unlikely from European regulators. Meanwhile, Barclays reportedly will appoint former JPMorgan Chase executive Jes Staley as CEO. The choice of an American investment banker might signal a change of strategy for Barclays' investment banking, observers say.
The China Securities Regulatory Commission has released draft rules governing algorithmic traders as part of a crackdown on strategies seen exacerbating a recent market rout. The rules include a requirement that traders report some information, which would be reviewed before they are able to buy or sell.
Updated draft rules on swaps trading from the European Banking Authority and the European Securities and Markets Authority could threaten London's plan to become a derivatives-trading hub for China.
Some European countries, including France, Italy and Germany, are resisting capital requirements for banks by introducing legislation to ease obligations for total loss-absorbing capacity.
Paul Andrews, vice president of international affairs at the US Financial Industry Regulatory Authority, has been named secretary general of the International Organisation of Securities Commissions, a source says. Andrews, who has served FINRA for 17 years, is poised to succeed David Wright, who is retiring at year-end.
European Central Bank President Mario Draghi said that the bank's quantitative easing and asset purchases have met or exceeded expectations but that it is going to take longer than expected to bring inflation up to the target of 2%. "Both the financial markets and the banking sector are giving indications that QE is working," he told the Greek newspaper Kathimerini. "It presently appears that it will take somewhat longer than previously anticipated for inflation to come back to, and stabilise around, levels that we consider sufficiently close to 2%."
Finance ministers from the Group of 20 nations backed a wide-ranging proposal by the Organization for Economic Cooperation and Development to update tax laws to prevent multinational corporates from using them to reduce their taxes. "This is a reaction of people who cannot stand anymore that they pay their fair share of taxes, that they contribute to fiscal consolidation while companies, especially multinationals, can avoid tax," European Economic Affairs Commissioner Pierre Moscovici said.
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