EU Announces Members, Mandate of Group to Assess Bank Structure
February 23, 2012, 7:23 AM ESTBy Jim Brunsden
Feb. 22 (Bloomberg) -- The European Commission published the members and remit of a group of experts that will examine whether banks should build internal firewalls to protect taxpayers and customers when failure of one part of a lender threatens to cascade throughout the company.
The group, to be chaired by European Central Bank council member Erkki Liikanen, will “determine whether, in addition to ongoing regulatory reforms, structural reforms of EU banks would strengthen financial stability and improve efficiency and consumer protection,” the Brussels-based commission said today in an e-mailed statement.
Measures to be considered by the group include “prohibiting banks from carrying out some activities or requiring banks to put certain activities (e.g. taking deposits from retail customers) into separate legal entities,” according to the statement.
Lenders including Goldman Sachs Group Inc., JPMorgan Chase & Co. and Bank of America Corp., have criticized plans by U.S regulators to ban commercial banks from proprietary trading, saying the draft measures would increase risk, raise costs for investors and be vulnerable to legal challenge.
Michel Barnier, the European Union’s financial services chief, has said that this initiative, known as the Volcker rule, will be among those examined by Liikanen’s high-level group.
The group will report “by the end of summer 2012,” the commission said.
The group’s members include European Aeronautic, Defence & Space Co. Chief Executive Louis Gallois and Alessandro Profumo, former chief executive officer of UniCredit SpA, Italy’s biggest bank.
--Editor: Jones Hayden
To contact the reporters on this story: Jim Brunsden in Brussels at jbrunsden@bloomberg.net;
To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net.
