‘Waning global appetite’ for new financial rules to be applied

The regulation of the international financial system has reached an “inflection point” against a backdrop of increasing political upheaval and “waning appetite globally” for internationally agreed rules to be implemented, a senior Central Bank of Ireland official has said.
Vasileios Madouros, deputy governor for monetary and financial stability, was speaking at the Federation of International Banks Ireland annual conference in the College Green Hotel in Dublin on Wednesday.
In an address at the event, Mr Madouros said “it is critical” Ireland advocates for the EU to implement globally-agreed reforms, including the so-called Basel III agreement, an ambitious overhaul of bank regulation agreed by supervisors around the world in the wake of the 2008 financial crisis.
Application of the reforms has been delayed amid intensive banking sector lobbying to water down the rules. European lenders are expected to redouble their efforts if US counterparts move to further dilute, or even scrap, the agreement following Donald Trump’s victory in the US presidential election.
Mr Madouros said it is particularly important for Ireland to advocate for the implementation of such agreements at EU level amid “waning appetite globally” for their application.
“History shows that there can be political-economy driven cycles in financial regulation,” he said. “And, globally, we now seem to be at an inflection point in that cycle.
“It is in everyone’s interest that these pro-cyclical patterns do not re-emerge.”
More to follow…