Chatham House: Independent thinking on international affairs

Financial Regulation

Towards a Global Regulatory Framework?
11 March 2013

Session One
The New Pan European Regulatory Architecture

It can be argued that in order for the Eurozone to survive, greater integration of banks and banking regulation is necessary. But in the EU's current crisis, capital is being renationalized.

  • How are national regulators reacting to this decline in cross-border financial flows in the name of domestic financial stability? Will they push for further repatriation of capital?

  • What steps is the European Central Bank (ECB) taking to support intra-eurozone financial flows and reduce repatriation of capital?

  • Will a single supervisory mechanism in Europe create greater stability? How will the ECB balance its roles as monetary authority and bank supervisor?

  • What form would 'banking union' take?
    • It is proposed that an integrated bank resolution structure should be created. What tensions may this cause?
    • What would the impact be on Europe’s national banks?

  • How will the UK and other non-euro EU members operate in the new environment?

  • The US, the EU and the UK are all considering 'ring fencing' proposals.  What are the respective merits of each? Will one system dominate?

Lord O’Donnell GCB
House of Lords

Keynote Speaker

Vítor Constâncio (on the record)
Vice President
European Central Bank

Arlene McCarthy MEP
Member of the European Parliament
Vice Chair of the Economic and Monetary Affairs Committee

Andrew Bailey
Executive Director and Member of the Financial Policy Committee, Bank of England, and Managing Director, Prudential Business Unit, FSA

Matias Rodriguez Inciarte
Vice Chairman, Member of the Board and Chief Risk Officer
Banco Santander

Sir John Vickers
Oxford University
Former Chair of UK Independent Commission on Banking

Questions and discussion

11.00  - 11.30  Refreshments

Session Two
OTC Derivatives

  • The Financial Stability Board has promoted a global regulatory framework on derivatives. Will this limit regulatory arbitrage?

  • The US and the EU are refining rules on derivatives in the US Dodd-Frank Wall Street Reform and Consumer Protection Act and the European Market Infrastructure Regulation (EMIR) respectively. To what extent are they co-operating?

  • What are plans for rules on margins for non-cleared trades?

  • What impact will the US' extraterritoriality on derivatives rules have on global harmonization? Could mutual recognition and equivalence address this issue, or will the effect be to make the US the centre of global derivatives trading? If so, how will emerging economy regulators respond?

Dame Clara Furse DBE
Non-Executive Director, Nomura Holdings, Legal & General, Amadeus IT Holdings and the UK’s Department for Work and Pensions

Verena Ross
Executive Director
European Securities and Markets Authority

Jonathan Faull
Director General, Internal Markets and Services
European Commission

Eric Pan
Associate Director, Office of International Affairs
Securities and Exchange Commission

Alexa Lam
Deputy CEO and Executive Director, Hong Kong Securities and Futures Commission and
Co-chair, Working Group on Margining Requirements of the Basel Committee on Banking Supervision and the International Organization of Securities Commissions

Melissa Allen
Partner, Financial Services Risk Consulting

Mark Woodward
Director of Corporate Development
ICE Clear Europe

Questions and discussion

13.30  - 14.30  Lunch

Session Three
Rules for 'Shadow' Banking

The Financial Stability Board and other regulatory authorities are looking at the role of credit intermediaries, taking place outside or partly outside the banking system. How can regulators ensure greater stability whilst retaining shadow banks' willingness to lend?

  • It can be argued that alternative intermediaries promote stability and resilience in the financial system by providing an alternative route for finance. What risks do they pose?

  • What form should regulation of alternative intermediaries take? Should it differ between different types of intermediary eg money market funds, hedge funds?

  • Would greater transparency in 'shadow' banking activities raise confidence?

  • Will it be possible to have a global set of rules given the different positions of major financial centres on insurance, hedge funds, and money market funds?

Hugo Dixon
Reuters News

Svein Andresen
Secretary General
Financial Stability Board

Alexa Lam

Bill Winters
Renshaw Bay

Barney Reynolds
Head of European Financial Institutions Advisory, Partner
Shearman & Sterling

Questions and discussion

16.15    Close of conference and drinks reception hosted by Chatham House

© The Royal Institute of International Affairs 2013