Today, the European Commission has issued a proposal to make the regulation and supervision of investment firms more proportionate. Smaller investment firms shall enjoy a lighter regime, while very large firms shall be put under the common supervision of the ECB’s single supervisory mechanism (SSM). The proposal has to be agreed by the Parliament and the Council of member states.
Sven Giegold, the Greens/EFA spokesperson for finance and former co-rapporteur for the creation of the SSM comments:
“This is a welcome strengthening of the banking union. Large investment firms should be supervised by the ECB in order to end regulatory competition in the common market. In principle we welcome a lighter regulatory regime for small investment firms as long as new significant shadow banking operations are avoided. We will study in detail whether the new rules are consistent with the efforts of the Financial Stability Board to curb shadow banking.
The proposal of the Commission presents a good opportunity for the Parliament to discuss the dangerous power of large investment firms such as Blackrock. Recent research demonstrates that very large asset managers have gained an unacceptable level of power over the real economy. Greens will make sure that this grown power will become part of the debate.”
The proposal of the EU Commission can be found here: