[QiuCIOdO]

http://www.ft.com/cms/s/0/be761538-c...44feabdc0.html

[Svatudjw]

Making London's decision to keep the Pound-Sterling smart. Won't be as bad to withdraw from the EU when you have your own economic system fully in place.

[Bwvapays]

http://www.ft.com/cms/s/0/c3fd0260-d...nclick_check=1

Boost for France in banks shake-up
By Joshua Chaffin and Nikki Tait in Brussels and Alex Barker in London

Published: November 27 2009 11:35 | Last updated: November 27 2009 21:02

Michel Barnier will take over a job that encompasses a broad swathe of policy, from financial services oversight to accountancy matters, liberalisation of postal services and facilitating cross-border services

France will have a stronger hand in recasting Europe’s post-crisis banking and financial services sector over the next five years after its nominee for the European Commission, Michel Barnier, snagged the internal market portfolio.

The French victory came after months of intense lobbying over top Commission jobs that culminated on Friday in an announcement of new portfolios by José Manuel Barroso, the European Commission president.

Alarmed about Mr Barnier’s possible influence over the City of London, the UK had pressed for Mr Barroso to separate financial regulation from the internal market portfolio. Mr Barroso resisted a last-minute phone call from Gordon Brown, saying on Friday that it had never been his intention to split the job. Instead, he revealed a desire to move financial services into the economic and monetary affairs portfolio, but only once cross-border co-ordination of policies had been improved.

“That comes only when we have a real internal market for financial services,” he said.

The City of London received some reassurance in the form of Jonathan Faull, the British bureaucrat currently heading the justice, freedom and security department, who is to become the top civil servant in the internal market department.

British diplomats also said that they expected to have strong positions in Mr Barnier’s cabinet – the team of people who support the commissioner.

“Even if Nicolas Sarkozy gets on the phone and tells [Mr] Barnier to close down the City of London, it’s not possible for one commissioner to do that,” said one British official.


As new laws are drawn up, there are sharply differing views between European powers, such as France and Italy, which want a more centralised system, and others such as Britain, which want to retain domestic control.

There were fewer surprises for the rest of the top economic posts, whose nominees will still face a confirmation hearing in January before the European Parliament. The competition commissioner’s job went to Joaquín Almunia, the Spanish nominee and holder of the economic and monetary affairs job in the current Commission. His predecessor, the tough-minded Neelie Kroes, will take over the telecommunications portfolio.

Copyright The Financial Times Limited 2009. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web

[Stivenslivakovishhhs]

Firstly Hedge Funds only make up a tiny part of London's Financial Industry employing 10,000 people mainly in London and generating the UK Treasury £3.5 Billion a year. It should also be noted that many hedge funds are based in plush offices in the West End of London rather than London's traditional financial areas. Secondly the same rules will apply throughout the EU, so nobody will gain. Thirdly no legislation has been passed yet and there will have to be a good deal of negotiation by all parties before any concrete legislation can be put in place, and there is little doubt that any future legislation faces being considerable watered down.

[Taunteefrurge]

http://www.bloomberg.com/apps/news?p...2VFpBGpY&pos=2

EU Finance Chiefs Overcome U.K.-France Bank Clash (Update1)
Share Business ExchangeTwitterFacebook| Email | Print | A A A By Mark Deen and Emma Ross-Thomas

Dec. 2 (Bloomberg) -- European Union finance ministers overcame a clash between the U.K. and France to reach an agreement on overhauling financial supervision for the bloc.

“We’ve found a compromise. We’re in the process of creating a real European authority,” French Finance Minister Christine Lagarde told reporters in Brussels today. “It was a laborious process; not everyone was on same wavelength.”

The EU is aiming to revamp banking supervision a year after the bankruptcy of Lehman Brothers Holdings Inc. exacerbated a financial crisis that forced European governments to spend, lend or guarantee more than $5 trillion to support banks. An economic-risk watchdog led by central bankers, as well as new EU agencies to oversee banks, insurers and investment firms are intended to prevent a repeat of the worst global crisis since the Great Depression.

Finance ministers had sparred over how much power the European supervisors should wield over national authorities. The clash in Brussels came amid U.K. concern that the appointment last week of Michel Barnier, an ally of French President Nicolas Sarkozy, as EU commissioner for internal markets will see London face a tougher regulatory environment during his five-year term.
Big Losers

“It’s the first time in 50 years that France has had this role,” Sarkozy said in an interview with Le Monde published on Nov. 28. “The English are the big losers in this business.”
Ahead of the meeting today, U.K. Chancellor Alistair Darling wrote in the London-based Times calling for less power for the Europe-wide watchdogs and said that success of businesses in London was in the interests of Europe.

“London, whether others like it or not, is New York’s only rival as a truly global financial center,” Darling wrote. “No other center in Europe offers the same range of services. It is in all of Europe’s interests that they prosper alongside their close European partners.” London has already been eclipsed by New York and Singapore as a global financial center, according to a Bloomberg Global Poll in October. Deal

Under the deal, countries can overturn European supervisors’ decisions by garnering a simple majority among the 27 EU members, Lagarde said.

France had wanted members to need a qualified majority to overturn a decision, while the U.K. tried to restrict the supervisors’ control, calling for the burden to be on them to seek a majority before forcing a country to use public funds for a bail out.

In non-emergency situations, voting will be based on members present rather than all member states.

“It seems like a loss for the U.K. but there’s still a big debate to be had about the consequences of calling an emergency,” Simon Gleeson, financial regulatory specialist at Clifford Chance LLP in London, said in a telephone interview today. “To the extent this means something, I think it is a loss for the U.K.” The new regulatory system, including a European Systemic Risk Board of central bankers and national regulators, would ensure EU market laws are implemented the same in every country and strengthen supervision across the 27-nation bloc.

The board is designed to issue warnings and recommendations, flagging problems such as the build-up of investments in U.S. subprime mortgages. Three new European Supervisory Authorities would oversee banking, securities and insurance and pensions, according to the commission’s proposal.

“It wasn’t easy merging the goals of an effective European supervision structure, keeping national authorities capable, better managing cross-border conflicts where they exist and respecting the rights of national parliaments,” German Finance Minister Wolfgang Schaeuble said.

To contact the reporters on this story: Emma Ross-Thomas in Brussels at erossthomas@bloomberg.net; Mark Deen in Brussels at mdeen@bloomberg.net.

Last Updated: December 2, 2009 10:44 EST

[Marat]

http://www.timesonline.co.uk/tol/new...cle6939895.ece

December 2, 2009

We are in charge now, Sarkozy tells the City


Alistair Darling has delivered a blunt warning to the EU’s new French finance chief against meddling with the City of London.

As Nicolas Sarkozy gloated over impending curbs on the City, the Chancellor said that such moves would drive financial services out of Europe.

The French President’s glee at the appointment of Michel Barnier as Commissioner for the Single Market took on an edge of menace yesterday when he said that unfettered City practices must end.

“Do you know what it means for me to see for the first time in 50 years a French European commissioner in charge of the internal market, including financial services, including the City [of London]?" he said yesterday. "I want the world to see the victory of the European model, which has nothing to do with the excesses of financial capitalism," he said. His implicit threat was just what Downing Street had feared when Mr Barnier, formerly an agriculture minister, was given the portfolio last week.

Mr Darling, writing in The Times today, says that it would be a “recipe for confusion” if firms were supervised by the EU as well as national watchdogs and that Britain would not accept new laws that could lead to taxpayers picking up the bill for bailouts ordered by Brussels.

He rejects claims that the economic crisis was the fault of the “Anglo-Saxon” model, pointing out that French and German banks were among the biggest creditors of the failed US insurance giant AIG.

Terry Smith, a prominent banker, said that the threat of increased regulation was already threatening the City’s future.

“I’ve never seen so much work going on by companies, individuals and teams of people to evaluate relocation out of the UK,” he said.

[VodsNittats]

http://business.timesonline.co.uk/to...cle6939892.ece

From The Times December 2, 2009

It’s déjà vu all over again as Sarkozy takes aim at City of London

By Suzy Jagger, Martin Waller and Francis Elliott

Napoleon Bonaparte scorned England as “a nation of shopkeepers”, but he knew it was the vitality of the City of London that made Britain such a threat to his imperial ambitions.

The feeling was mutual. The City, fearful of a European ruler who would cut off their trade, readily funded the war effort that culminated in Napoleon’s downfall. Last night the City was again going on the offensive as one of its most successful bankers predicted that the French President’s criticism of Britain’s financial sector would encourage firms to quit Britain for markets more supportive of business.

Terry Smith, chief executive of the bonds broker Tullett Prebon, told The Times: “I’ve never seen so much work going on by companies, individuals and teams of people to evaluate relocation out of the UK. Switzerland isn’t in the EU, but there are other destinations being considered as well.”
President Sarkozy expressed glee yesterday at the appointment of Michel Barnier as finance chief in Brussels. Last month the Frenchman was appointed European Commissioner for the internal market and financial services. Mr Barnier now has influence over the reform of hedge fund, banking, insurance and banking regulation.

At a meeting of European finance ministers in Brussels today, the powers of three new EU-wide economic watchdogs are to be agreed. The French are leading a drive for the bodies to be given power directly to interfere in the workings of individual companies, a move resisted by Britain.

A proposed EU directive covering the workings of Britain’s private equity industry is also entering a key phase in negotiations.

Yesterday Mr Sarkozy said that the nomination of a French commissioner in charge of EU markets would help continental economic ideals to prevail over the discredited Anglo-Saxon model. In a speech in France the President blamed the reputedly free-wheeling Anglo-Saxon model for the global economic downturn. The Group of 20 rich and emerging nations had made remarkable strides during the crisis to regulate bonuses and eliminate tax havens, but the battle was not over, Mr Sarkozy said.

“Do you know what it means for me to see for the first time in 50 years a French European Commissioner in charge of the internal market, including financial services, including the City [of London]?” he said of Mr Barnier’s nomination. “I want the world to see the victory of the European model, which has nothing to do with the excesses of financial capitalism.”

His comments met with alarm and dismay in the City. One senior banker said: “Surrendering control of the City of London to the French in return for some nonentity getting a non-job [Baroness Ashton of Upholland’s appointment as EU foreign affairs chief] is one of the biggest fiascos of British diplomacy since Suez. The fact that Sarkozy is now being gleeful makes it worse. The Prime Minister must explain how he will protect the City from EU meddling or lose what remaining credibility he has in the City.”

Sir Victor Blank, the banker and company chairman whose work forms the basis of Britain’s takeover code, told The Times that the “inherent strength” of Europe meant that any changes to financial regulation would take years to implement and that such measures would need the approval of 27 member nations of the EU.

“This is not something that will shift and change overnight. It will be subject to debate. The City of London has an innate strength. People want to be here.”

Richard Lambert, Director-General of the CBI, said: “Mr Sarkozy needs to be very careful with his rhetoric because he is making the job of Mr Barnier much more difficult. Mr Barnier has made clear — very sensibly — that he sees the City of London as one of Europe’s most valued assets.”

Lord Levene of Portsoken, the head of the Lloyd’s insurance market, the biggest in the world, said of Mr Sarkozy’s words: “That’s today’s quotation. There will be another one tomorrow. I can’t get too excited about it. I think what we should do is to get our highest representative to intervene on our behalf. You know what politicians are like — good for a quote.”

Simon Walker, head of the British Venture Capital Association, whose members are facing onerous proposed regulations from Brussels, said: “This is not a war against capitalism. But there is a need for a much greater degree of subsidiarity which respects the models of different countries.”

He added: “President Sarkozy’s rhetoric is over the top and he is clearly playing to his domestic audience. The free market is deeply entrenched in the British psyche.”

Another senior City source, who declined to be named, said: “Sarkozy’s language is very alarming. If it is a true reflection of Barnier’s approach, that is very bad news for London indeed. Besides, Sarkozy’s analysis is completely wrong. European companies also imploded during the crisis. There is very little evidence that excessive bonuses, however distasteful, caused the crisis themselves.”

Last century, another Frenchman, Charles de Gaulle, had a similar antipathy for the Square Mile, which he made clear in the 1960s when he withdrew his country from the Gold Pool, the London-based reserve designed to stabilise currencies by tying them to the value of gold.

[LINETFAD]

You've been posting the same articles in two threads. This one's unnecessary.