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Friday, September 25, 2009

EU proposes new bank 'super regulator'

The European Union (EU) is continuing with its plans to create a new 'super regulator' for banks and other financial institutions operating in Europe.

President of the EU Commission Jose Manuel Barroso announced the proposals - which include the formation of a new European Systemic Risk Board - yesterday (September 23rd).

The move came ahead of this week's meeting of G20 leaders in Pittsburgh and the EU said in a statement: "The European system can also inspire a global one and we will argue for that in Pittsburgh."

Employees from the European Central Bank would be used to staff the risk board and the EU has also suggested forming three new regulatory bodies to oversee exchanges, the insurance industry and banks.

Mr Barroso remarked that the aim is to ensure the "dark days of autumn 2008" do not happen again.

Last week, it emerged that the EU may force Lloyds Banking Group to sell its Halifax arm as compensation for the funding it was given by the UK government during the credit crunch.

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