A first step towards post-McCreevy responsible banking regulation

6 May 2009

Statement by Proinsias De Rossa

Voting in favour of new rules for regulation for the banking sector to avoid future collapses today in the European Parliament, Dublin Labour MEP Proinsias De Rossa said that the new policy was a step forward out of the disaster created by McCreevy-style light regulation of banks but that further measures will be needed.

"Business as usual is finished. Europe must now begin a new post-McCreevy era of diligent and responsible regulation and supervision. While today's vote sends an important signal to the bankers, these new rules do not go far enough. I want to see tougher bank capital rules to ensure banks set aside enough capital and do not need bailing out when markets fall.

"Banks should retain more than the mere five per cent value of the securitised products they sell. Securitised products, such as mortgage-backed securities, are at the centre of this crisis. To help create confidence when people are losing trust, we will have to return to this issue after the new Commission and Parliament are in place.

"We need a working financial system, so we must step in to ensure we have one. Charlie McCreevy's obsession with self-regulation and light regulation must be a thing of the past. Banks must be effectively regulated at national and European level, and restricted to serving the real economy."

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